Greece's Eurobank, Alpha Bank Report 1st-Quarter Loss

EFG Eurobank Ergasias SA and Alpha Bank SA, Greece’s second- and third-biggest lenders, posted first-quarter net losses as non-performing losses rose.

Eurobank’s net loss was 236 million euros ($291.4 million) after a year-earlier profit of 74 million euros, according to an Athens bourse filing today. Alpha Bank said it had a net loss of 107.8 million euros after a 10.5 million-euro profit a year earlier, according to an e-mailed statement today.

Non-performing loans at Eurobank rose to 17.2 percent at the end of the quarter from 11.4 percent a year earlier. At Alpha NPLS, they rose to 15.7 percent from 9.3 percent, with Greek loans constituting the biggest portion.

“Our goal is to continue strengthening Eurobank’s position in the context of the recapitalization effort and to actively contribute to the recovery of the Greek economy,” Eurobank Chief Executive Officer Nicolaos Nanopoulos said in the bank’s statement.

Greece’s four biggest banks needed an 18 billion-euro bridge recapitalization this week after reporting a combined loss of 28 billion euros in 2011 as they wrote down their Greek government bond holdings. The banks were shut off from ECB refinancing operations, depending on the Bank of Greece’s Emergency Liquidity Assistance program, pending the capital injection.

Greek bank reliance on ELA, which is extended by the Athens-based central bank, fell to 46.3 billion euros in March from 107.2 billion euros in February, according to Bloomberg calculations.

Eurobank’s deposits fell to 31.6 billion euros at the end of March from 32.5 billion euros the previous quarter. Alpha Bank’s deposits declined to 27.8 billion euros from 37.6 billion euros a year earlier. Alpha said deposits rose in March and April before “adverse developments on the political front led to a resumption of deposit flight thereafter.”

Greece is holding a second election on June 17 after a May 6 vote failed to produce a government, fanning concern that the country may be forced out of the euro.

“The scenario of Greece’s euro exit is unlikely to materialize,” Alpha Bank said today. “Irrespective of pre-election rhetoric, no political party will assume responsibility to go against the will of the voters who predominantly want Greece to stay in the euro area.

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