Brussels, 29/04/2014 (Agence Europe) - On Tuesday 29 April, the European Commission found that the restructuring plan of Eurobank Group of Greece is in line with EU state aid rules. On the basis of the plan, the Commission has approved under EU state aid rules the restructuring aid granted by Greece to Eurobank Ergasias S.A., including recapitalisations by the Hellenic financial stability fund (HFSF) in 2012 and 2013, as well as the HFSF's backstopping of the ongoing recapitalisation. The HFSF owns 90% of Eurobank.
Competition Commissioner Joaquin Almunia wrote to the Greek authorities in March, issuing recommendations for the current recapitalisation (see EUROPE 11047) and suggesting that public monies only be used as a last resort. On Tuesday, the Commission welcomed the fact that, as recommended by Almunia, FHSF cash will only be used if the prior conversion of subordinate debt into shares fails to raise enough capital.
The restructuring plan runs until 2018. It mainly aims at a deeper refocusing on core banking activities in Greece and a return of these operations to strong profitability without causing competition problems, explains the Commission. Eurobank has received nearly €6 billion from FHSF since 2012. The Commission opened an investigation in July 2012. On Tuesday, the Commission gave the go-ahead to Eurobank's acquisition of Nea Proton Bank and New Hellenic Postbank. (EL)