Greek banks reduce foreign presence by 64% since 2012; boost liquidity, capitals from sell-offs

Friday, 25 August 2017 20:32
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By A. Doga

Greek systemic banks' obligation to downsize or sell-off their overseas operations has dramatically decreased their relevant networks abroad by 64 percent, with the result, however, translating into much needed liquidity and capital.

The sell-offs adhere to Greek banks' recapitalization obligations and memorandum-mandated restructuring programs.

At the end of 2016, the foreign subsidiaries of Greece's four systemic banks operated 1,436 branches and employed 20,156 people. Within the ongoing year, and following several latest sell-offs, the network was reduced to 957 branches and the relevant workforce stood at 13,900.

The divestiture began in 2012, at a time when Greece-based banks fielded a total of 2,591 branches abroad, mostly concentrated in southeast Europe, and with a relevant workforce of nearly 39,000.

The latest sale on the horizon appears to involve Eurobank's Romanian subsidiary, Bancpost, with at least two competitor banks and two funds expected to submit bids in a tender, whose deadline expires on Friday. In a latest development, Hungary's OTP, which recently acquired Banca Romaneasca from National Bank of Greece (NBG), is not expected to submit a bid, according to reports.  

In terms of recently finalized deals, South African regulatory authorities this week approved of the sale of NBG's South African Bank of Athens (SABA) to a subsidiary of AFGRI Holdings and Fairfax Africa Investment.

SABA was one of National Bank's oldest subsidiaries, having been established in 1947, and with an expertise in servicing SMEs' banking needs.

The sale comes after NBG's withdrawal from the markets in Turkey, Bulgaria, Romania and Serbia. It still operates a subsidiary in Albania, while the sale of its operations in the former Yugoslav Republic of Macedonia (fYRoM) via Stopanska Bank is pending.

Greek lender Eurobank still operates in Cyprus, Bulgaria and Serbia, while Alpha Bank has sold its subsidiaries in Bulgaria and Serbia, but retains operations in Romania and Cyprus. 

The fourth Greek lender, Piraeus Bank, is also rapidly trying to implement its restructuring plan, aiming to sell international operations with total assets worth 3.3 billion euros. Over the last 18 months the Piraeus Bank group has sold loan portfolios worth 400 million euros in Romania and Bulgaria. It has also dis-invested from affiliates in Egypt, Cyprus and Marathon Bank in the US.  

Next up is the sale of a series of finance subsidiaries in southeast Europe.  

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