UPDATE 1-Piraeus second Greek bank to complete share offering
* Piraeus second Greek lender to successfully tap investors
* Plans to place 10 pct of share offering with Greek investors
* Offering at 10 pct discount to Wednesday's share price (Adds analyst comment, bank confirmation, background)
By George Georgiopoulos
ATHENS, March 26 (Reuters) - Piraeus Bank on Wednesday became the second Greek lender to successfully complete a share offering, signalling growing confidence that the country's battered banking sector is leaving the worst of a sovereign debt crisis behind.
Piraeus, the country's second-largest lender by assets, tapped investors for 1.75 billion euros of new shares, without pre-emption rights for existing shareholders, to bolster its equity capital and pay back preferred shares held by the state.
The bank said the offering was priced at 1.70 euros a share, at a 10 percent discount to Wednesday's share price after books closed, confirming what an unnamed executive at the bank said earlier.
The offering was oversubscribed, with investors offering over 3 billion euros, the executive said.
Greek banks are tapping markets before an expected wave of fund raising by European peers in a bid to boost their capital position ahead of the European Central Bank's health check by November, when it becomes their supervisor.
Proceeds from Piraeus's share offering will plug a 425 million euro capital shortfall a stress test by the Greek central bank revealed earlier this month and pay back 750 million euros of preferred shares owned by the state.
Greece's top four banks - Alpha, National, Eurobank, Piraeus - and smaller peers Attica and Panellinia Bank were found to need an extra 6.4 billion euros in capital to make themselves strong enough to withstand further loan losses and other potential shocks, the Greek central bank's stress test found.
Peer Alpha Bank closed books on a 1.2 billion euro equity offering on Tuesday, pricing it at 0.65 euros a share - a 7 percent discount to the share's closing price on Monday.
Piraeus said foreign investors offered a total of 5.5 billion euros for both offerings, suggesting Alpha Bank's offering was similarly oversubscribed.
"It is a vote of confidence for the Greek banking sector as both offerings were completed successfully, indicating pent-up demand for Greek shares," said analyst Maria Kanellopoulou at Athens-based Euroxx Securities.
Piraeus will seek approval for the offering price at a shareholders meeting set for Friday and plans to place 10 percent of the new shares with Greek retail and institutional investors at the same price.
A total of 1.03 billion new shares will be issued.
The group, with a market value of 10.2 billion euros and majority-owned by Greece's bank rescue fund HFSF, had mandated Credit Suisse, Deutsche Bank and Goldman Sachs as joint global coordinators and bookrunners for the share offering. BNP Paribas was co-lead manager with UBS and Mediobanca joint bookrunners.
Greek banks suffered huge losses from the country's sovereign debt restructuring and bad loans because of the ensuing deep recession. The top four were recapitalised with 28 billion last summer, with 25 billion injected by Greece's bank rescue fund HFSF which became their majority shareholder. (Reporting by George Georgiopoulos, editing by Louise Heavens)