Financial Times
January 3, 2011
Piraeus Bank, Greece’s fourth biggest bank, unveiled the terms of a rights issue on Monday, showing that Athens’ beleaguered banks can tap the markets in spite of concerns over the health of the country’s economy and financial sector.
The economy is expected to shrink 3 per cent in 2011 after contracting an estimated 4.2 per cent in 2010.
The bank decided on Monday to go ahead with a rights issue to raise €807m ($1.1bn) in cash to boost its capital adequacy ratios to comply with a stricter supervisory framework, cope with challenging economic conditions in Greece and explore organic growth opportunities in neighbouring countries, it said.
Some local bankers say the rights issue is a precautionary move to deal with losses related to the sovereign debt crisis.
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