Six are the strategic pillars of the 5th banking pole that is expected to emerge from the merger of Attica Bank and Pancreta Bank, as Attica Bank's CEO Elena Vrettou said at yesterday's Extraordinary General Meeting. 

•  Immediate capitalisation of merger synergies for savings cost savings
• Strategic targeting and rapid deposit growth with competitive pricing to expand customer base and increase liquidity
• Develop 'affluent' clients and improve Wealth Management services, with the aim of converting fixed-term clients and increasing commissions
•  Target and expand into loans to SMEs with new competitive products and services (one-stopshop), taking advantage of the current competitive gap
• Building a 'simple and everyday' bank with a focus on specialised banking
  (RMs)
• Optimising business banking profitability with new and specialised products and entering new markets

THE IMPORTANCE OF THE MERGER

The merger, which received the green light from the Competition Commission a few days ago, creates, according to Ms. Vrettou, a new healthy, dynamic and competitive banking organization whose importance goes beyond the consolidation step. It embodies, she said, the vision of a new, strong financial institution, twice the size, with a healthy balance sheet and a high return on equity, able to meet the challenges of the future and better serve the needs of the market, targeting small and medium enterprises and individuals. 

ASSETS OF €10 BILLION. 

According to Ms. Vrettou, the new bank, at the end of 2024, is estimated to have total assets of €10 billion. "Our target is for 2027 lending to be at €7.6 billion, with significantly higher revenues of around 20% compared to the sum of the revenues of the two banks."

OPERATIONAL CHALLENGES 

For his part, Attica Bank's Chairman of the Board, Yannis Zographakis, said that Attica has proven that it can have recurring operating profitability, stability, and reliability. He acknowledged that the merger process will have many operational challenges; however, the goal is to ensure a smooth transition, without interruptions in operations, so that the new bank can begin operations without delays or problems.

MAIN POINTS OF AGREEMENT 

The main points of the key shareholders' agreement following the merger of the two banks are:

• Subordination of red loans to Hercules III
•  NPE ratio below 3%, equal to or better than that of the systemic banks
• Recapitalization of the new bank through a new €735 million AMC, with a target CET1 ratio in 2023 of 15% pro-forma for Hercules' losses
• First developmental AMC to cover:
• Losses from the final resolution of the Bank
• Restructuring costs
• New investments (new technologies, upgrading of branches,
  rebranding, etc.)
• The growth of the bank (new lending)

THE TIMETABLE

4/9/24: legal merger completed
Oct. 24 - Nov. 24: AMC and issue of warrants for the new Bank
Dec. 24: clearing by the IACs
1/1/25: Start of operations of new strong ban