The creation of a new banking hub is something that the Greek banking system needed.
It’s shrinking banking sector after the crisis, with the closure of many banks and abundance red loansleft a significant gap in sector developmentwhich in fact seems to have passed into the next day. If one looks for the gaps in the banking system, one will notice that perhaps the most important of all is that small and medium-sized enterprises, and especially small businesses, have difficulty finding the “entry” to Greek banks.
The purpose of the new pole is the financing of small and medium-sized companies, the creation of a banking culture that offers solutions to customers beyond fashion options and, finally, the strengthening of a banking hub, based on modern economic trends, which however do not only concern large customers.
Shareholders committed to strengthening capital Bank of Attica, contributing to cash up to 675.1 million euros, of which 475.1 million maximum will contribute the FHEF and up to 200 million will be contributed by Thrive.
The above funds will be provided as part of the increase in the share capital of Banco da Ática, with pre-emptive rights in favor of the existing shareholders and the issuance of Banco da Ática shares (“Warrants”) in favor of those of its shareholders, who will have registered and covered the AMK. Through the capital assistance, it is intended to raise up to 735 million euros.
This means that the warrants will amount to €60 million. HFSF is expected to hold at least 35% of the share capital and voting rights of Attica Bank after the increase, and Thrivest is expected to hold a percentage ranging from 50% plus one share to 58.5% of the share capital and voting rights of Attica Bank.
It should be noted that Thrivest’s percentage stake in Attica Bank may increase if Thrivest chooses, at its discretion, to invest an amount greater than the 200 million euros referred to above, as part of the capital increase.
The Chronicles
The path to the 5th pole started in 2022. In particular, on March 17, 2022, the HFSF signed the framework agreement with Attica Bank, defining the framework for its corporate restructuring and modernization, following the model of other banks but with differences, as it was taken into account the fact that Attica Bank is not a systemic bank.
The terms of the transaction were amended on January 31, 2022, with a new agreement to be signed on September 30, 2022. Significant developments occurred in 2023, including the exit of Rinoa LTD – Ellington Solutions AE from the investment agreement and the signing of a new investment agreement with Thrivest Holdings LTD and the Pancricia Bank for the second capital increase of Attica Bank, which was successfully completed on April 26, 2023, with the raising of €473,346,868.50, of which €329 million were contributed by the Fund.
Thrivest was a reliable partner, providing the necessary funds to complete the deal, ensuring the strategic development prospects and new direction of Attica Bank, and at the same time providing the guarantees for the creation of the fifth banking pillar.
In “Hercules III”
Regarding the model of the new bank that will be created, the shareholders agreed to cover the necessary funds, in order to include the non-performing loans of the two banks, Attica and Pancritsia, in “Heracles III”, while the gap will be filled through share capital increases.
The funds will finance the gap that will be created in the banks’ assets due to the cancellation of non-performing loans, but certainly also for development purposes. The rescue of the Pankritia and Attica Banks was a one-way street for the banking system as a whole, otherwise there would have been a risk of a reduction in deposits, with all the known consequences that such an action could have for the banking system.
The new bank will be established by the end of the year. Thrivest has so far invested €140 million in Attica Bank and Pankritia Bank, in addition to the €200 million it is required to provide as a capital increase.
Attica Bank’s assets (sizes 2023) are €3.77 billion and Pancreatia’s are €3.45 billion, Pancreatia’s deposits are €2.6 billion and Attica Bank’s are €3.15 billion, while pre-tax profits for the year 2023 amounted to €90.8 million for Pankritia Bank, compared to €28.6 million for Attica Bank. Furthermore, it should be noted that Pankritia Bank together with Thrivest Holding already own 9.4% of Attica Bank.