Brussels, 27/07/2012 (Agence Europe) - On 27 July 2012, the European Commission approved a bridging recapitalisation provided by the Hellenic Financial Stability Fund (HFSF) for Alpha Bank, EFG Eurobank, Piraeus Bank and National Bank of Greece, for reasons of financial stability given the size of the banks in question (which between them account for three-quarters of the Greek banking system). At the same time, the Commission has opened four in-depth investigations to examine whether the measure is in line with its rules on state aid for banks during the crisis.
In May 2012, the HFSF granted the banks a bridging recapitalisation to cover the period until their final recapitalisation is implemented. More precisely, the HFSF deposited, in the banks European Financial Stability Fund (EFSF), floating notes with maturities of six and ten years. The total amount received by the four banks is €18 billion.
Greek banks have participated in the Greek government bond writedown, known as private sector involvement (PSI). The debt exchange resulted in very significant losses, depleting the capital base of the banks. The bridging recapitalisations have restored the banks' capital ratios to a level that allows their functioning on the market and access to euro-system operations. The measure aims to help the banks to comply with the national regulatory capital requirements of 8%. They are classed as state aid because the banks would not have been able to raise the capital on the financial markets. (FG/transl.fl)