Greek Banks Rise on Recapitalization Agreement: Athens Mover
Alpha, Greece’s third-largest lender, advanced 11 percent to 1.47 euros at 2:43 p.m. in Athens. Piraeus Banks SA, the nation’s fourth-biggest, rose 13 percent to 56 cents. The Athex Exchange Banks Index of the country’s eight publicly traded Greek banks climbed 6.5 percent.
The three parties supporting Prime Minister Lucas Papademos’s interim government yesterday struck a deal to inject more capital into the country’s lenders, one of the measures demanded by the European Commission, the International Monetary Fund and the European Central Bank in return for a 130 billion- euro ($170 billion). The deal allows banks to get money to insulate them against losses they will incur in a government debt swap without subjecting them to government control. Creditors had expressed concern about allowing the state to exert too much control.
“The bank recapitalization has been one of the key issues on the discussions of the government with troika and the political leaders,” Panagiotis Kladis, an analyst at Athens- based National Securities, said in a note to clients today. “The terms of the recapitalization remain one of the key uncertainties for the banking sector, resulting in increased volatility.”
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