Greece - The race for returns
It's a case of eat or be eaten for banks in Greece. With stiff European competition on its way after the country joins Emu, banks are shaping up for the challenge with a string of M&A deals. But some purchases are easier to absorb than others. By Michael Peterson.
Turning round a troublesome bank where staff morale is low and the future outlook dismal is one thing; taking on Greece's most profitable bank with its unique culture and strong management is quite another. But this is the task facing EFG Eurobank with its acquisition of Ergobank. Small wonder that EFG Eurobank managing director Nicholas Nanopoulos describes it as the most difficult of the three recent acquisitions his bank has made. Sickly Cretabank bought last year was quickly absorbed into EFG Eurobank, but with Ergobank the operations will continue to run separately for some time.
EFG Eurobank's aggressive approach to bank consolidation - the Ergobank acquisition was one of Greece's first ever hostile takeovers - has pushed the institution, controlled by the Latsis banking and shipping group, into third place in the country's commercial banking league. Still at number one is the state-owned National Bank of Greece which recently listed on the New York Stock Exchange and has 37% of the loan market and 47% of deposits, followed by Alpha Credit Bank which considerably boosted its size after it took over state-owned Ionian Bank in May.