While Eurobank EFG is seeking damages from rival lender Alpha for pulling out of their merger agreement, Credit Agricole is reportedly struggling to find a buyer for its Greek subsidiary, Emporiki Bank, and the local credit sector is waiting for the recapitalization process to be completed to start its consolidation.
Addressing a general meeting of Eurobank shareholders on Friday, Chief Executive Officer Nikos Nanopoulos revealed that Greece’s third-biggest lender will take recourse to an international court of arbitration, seeking 50 billion euros from Alpha for breaking the deal that would have created a banking giant as far as the local sector is concerned.
“Sadly, Alpha unilaterally canceled the merger for reasons that we consider unfounded,” said Nanopoulos. “In our view, its cancellation led to a loss of important synergies for both banks and is incompatible with efforts to recapitalize and strengthen the banking system,” he added.
Eurobank officials suggested that the amount of 50 million euros sought in damages was provided for in the preliminary accord signed between the two banks in August 2011. Alpha had not responded to the revelation of court action until late on Friday. It pulled out of the deal earlier this year, suggesting the merger would not be to its group’s benefit.
Commercial bank executives are eager to map out the future of the local credit system, as the completion of the recapitalization process will signal the beginning of the “big concentration.” However it appears that lenders are finding it particularly difficult at this stage to get the cash needed for any mergers or acquisitions to take place.
The reported effort by France’s Credit Agricole to get a Greek bank to acquire Emporiki is a case in point, as sources argue that its initial effort that had set yesterday as a deadline failed to bear fruit. Sources insist that Credit Agricole intends to complete Emporiki’s recapitalization before proceeding to its sale to a Greek rival.
However, Greek banks cannot use any money from the 18 billion euros they received toward last month’s recapitalization without authorization from the Hellenic Financial Stability Facility, which is said to have rejected such an application by certain major domestic banks.
The market expects the French to seek a buyer again this fall.Πηγή: ekathimerini.com