Fate of Finansbank will be known next week

The process for the sale of National Bank’s Turkish subsidiary, Finansbank, is steaming ahead, with the bank’s management having received several binding offers that it is examining. It will likely announce its preference next week.

Although there is concern regarding any possible impact on the price due to the uncertainty and instability in Turkey due to Ankara’s currently turbulent relations with Moscow, National Bank sources express optimism that the sale will be completed according to the group’s planing.

The sale of the NBG’s Turkish subsidiary will entail two main benefits: The sale will reduce the group’s risk-weighted assets, thereby freeing up funds to further strengthen the bank’s capital adequacy indices, and the money that National will collect from the sale of its entire stake in Finansbank will contribute toward forming capital stock, allowing for the speedier buyout of the contingent convertible bonds (CoCos) issued by the Hellenic Financial Stability Fund (HFSF) as part of the recapitalization process.

In the recap process National drew the funds required by the baseline scenario of the stress tests (1.4 billion euros), while the remaining 3 billion required by the adverse scenario was covered by the HFSF. The CoCos issued amounted to 2.03 billion euros and can be bought out by the bank, thereby reducing the stake held by the state.

NBG’s new shares started trading on the Athens bourse on Monday, and the group’s president, Louka Katseli, stated that the bank “has managed to attract significant capital under very difficult circumstances.”