Greece's Eurobank to buy back hybrid bonds to boost capital

ATHENS Wed May 1, 2013 12:10pm EDT

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ATHENS May 1 (Reuters) - Greece's fourth-largest lender Eurobank said on Wednesday it plans to buy back up to 580 million euros ($765 million) of notes it had issued in exchange for new common shares as part of moves to boost its capital base.

Greece's four big banks including Eurobank will be recapitalised with 27.5 billion euros to restore their solvency and such liability management moves are required under a bailout scheme funded by the country's international lenders.

Eurobank aims to buy back five series of hybrid securities and a subordinated note at their nominal value, offering holders new common shares at the same price as those issued to a bank rescue fund covering its 5.84 billion euro capital need.

Eurobank, which has about 633 million euros outstanding in these securities, will seek shareholder approval for the plan on May 30 and expects to complete the buyback in June.

The new shares to be issued will be privately placed with the holders of the tendered notes, with existing shareholders waiving their rights.

Peer Alpha Bank last month launched a similar offer to repurchase hybrid bonds at a discount. (Reporting by George Georgiopoulos; Editing by David Holmes)

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