ATHENS, April 11 Greek lender Eurobank
will seek shareholder approval for a rights offering of up to
5.84 billion euros and an issue of contingent convertible bonds
(CoCos) of up to 1.7 billion euros as part of its
recapitalisation, it said on Thursday.
Greece's four major banks need 27.5 billion euros in fresh
funds to restore their solvency ratios to levels required by the
country's central bank after incurring losses from a sovereign
debt writedown and impaired loans.
Eurobank's capital needs have been set by the Bank of Greece
at 5.839 billion euros.
Most of the funds will be provided by a state bank support
fund, the Hellenic Financial Stability Fund (HFSF), in exchange
for new shares or contingent convertible bonds.
Under the terms of the recapitalisation plan agreed with the
country's international lenders, at least 10 percent of banks'
new common equity must be raised from the private sector to stay
CoCos will be exclusively taken up by the HFSF rescue fund
and Greek banks plan to resort to them if they fail to get 10
percent of their rights offering from private investors.
The country's largest lender National bank bought
84.3 percent of Eurobank via a share swap in February. The
integration of the two lenders was suspended this week after
they admitted they were unlikely to raise enough cash from
private investors and Greece's international lenders raised
doubts over the deal.
Eurobank's shareholders are due to meet on April 30 to
approve the bank's recapitalisation scheme.
Greece's international lenders have set aside 50 billion
euros from the country's bailout package to recapitalise viable
banks and cover the costs of winding down others that are deemed