PASOK divided over bank merger

A bid by Piraeus Bank to take over the state’s shares in ATEbank and Hellenic Postbank appears to have unsettled the ruling PASOK party, with MPs and ministers split over whether the deal should go ahead or not. Piraeus Bank on Thursday offered 701 million euros for the shares, which the government said it would consider. Finance Minister Giorgos Papaconstantinou had earlier encouraged consolidation in the Greek banking sector as a way of bolstering the strength of lenders during the country’s economic crisis. But some PASOK members were angered by the minister’s role in the affair. An indication of the level of frustration among some Socialists was the written statement issued by PASOK political council member Giorgos Panagiotakopoulos, titled «No to the Sell-off of State Banks and the Games of Bankers and Their Government Employees.» Sources said that a number of PASOK deputies were angered by the fact that the government appeared to be reneging on yet another of its election pledges, which was for the state to maintain a strong presence in the banking sector. There was a mixed reaction at the ministerial level, where Deputy Prime Minister Theodoros Pangalos appeared to support the deal. Sources close to the PASOK veteran said that it was high time that people realized Greece’s situation had changed drastically since last year’s election. Defense Minister Evangelos Venizelos, however, was more cautious, indicating that he favored bank mergers but did not want them to start with state lenders. Economy Minister Louka Katseli, who has been at odds with Papaconstantinou, did not comment but her opposition to the deal seemed evident from the fact that she met yesterday with striking Hellenic Postbank staff.