Greece's Piraeus Bank Confirms Interest In ATE Bank
07/16/2012| 12:40pm US/Eastern
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By Philip Pangalos
ATHENS--Piraeus Bank SA (TPEIR.AT), Greece's fourth-largest lender by assets, confirmed Monday that it is interested in acquiring troubled state lender ATE Bank SA (ATE.AT), as liquidity-starved Greek banks seek to consolidate and shore up their balance sheets after being hit by Greece's debt restructuring earlier this year.
"Piraeus Bank confirms its interest in ATE Bank, however, a confidentiality clause that has been signed does not allow any further information or comment to be made," Piraeus said in a bourse filing following press speculation of a possible tie-up between the two banks.
Greece's banks have been hit hard by the country's ongoing debt crisis. They face an unprecedented liquidity squeeze as nervous savers drain deposits, while nonperforming loans have soared amid the country's deepening recession.
Earlier this month, Greece's largest lender, National Bank of Greece SA (ETE.AT), said that it had held talks with Credit Agricole SA (>> CREDIT AGRICOLE), fueling speculation that it could be a front-runner to take over the French bank's ailing Emporiki Bank of Greece SA (TEMP.AT) unit.
Greece's four biggest lenders, which also include EFG Eurobank Ergasias SA (EUROB.AT) and Alpha Bank AE (ALPHA.AT), have been left technically insolvent after Greece's recent 200 billion euro debt restructuring wiped out their capital base and left them dependent on billions of euros worth of European and International Monetary Fund loans to stay afloat. Greece's bank rescue fund in May injected about EUR18 billion into the four big banks.
A looming state-backed recapitalization plan expected later this year is widely expected to lead to the de facto nationalization of the country's top lenders, and prompted talk of possible mergers within the sector.
Write to Philip Pangalos at philip.pangalos@dowjones.com and Stelios Bouras at stelios.bouras@dowjones.com
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