May 8, 2014 / 6:11 PM / 6 years ago

UPDATE 1-Greece's National Bank prices offering at 2.20 euros/share

* Offering priced at a 15 pct discount to Thursday’s close

* Bailout fund HFSF’s stake to fall to 57 pct from 84 pct (Adds background, quotes)

By George Georgiopoulos

ATHENS, May 8 (Reuters) - Top Greek lender National Bank (NBG) priced an offering of new shares at 2.20 euros each after books closed on Thursday as it aims to raise 2.5 billion euros ($3.5 billion), an official at the bank told Reuters.

NBG is the fourth major Greek bank to successfully tap international markets as prospects of a recovery in the Greek economy lure investors.

“The price that will be proposed to the shareholders meeting on May 10 will be 2.20 euros a share,” the official said, declining to be named. NBG will hold a shareholders meeting on Saturday to formally approve the equity issue.

Another banking source close to the deal said Fidelity, Pimco, BlackRock Inc, Norway’s sovereign fund Norges and funds managed by billionaire financier George Soros were among the foreign investors that bought the shares.

Yield-hungry investors have snapped up recent offerings from Greece’s Alpha Bank, Piraeus and Eurobank , which have raised 5.81 billion euros between them through similar equity offerings over the past six weeks.

The new shares in NBG’s offering were priced at a 15 percent discount to Thursday’s closing price of 2.58 euros a share.

NBG has a current market value of 6.73 billion euros and is 84 percent-owned by Greece’s bank bailout fund, the Hellenic Financial Stability Fund (HFSF).

The offering was substantially oversubscribed, the first official said, adding that HFSF’s stake in the lender will fall to 57 percent after the share issue.

Its equity offering did not include pre-emption rights for existing shareholders, including the HFSF.

Proceeds from the sale will be used to cover the difference between a 2.18 billion euro capital hole, revealed in a central bank stress test in March, and other moves to boost capital by 1.04 billion euros that have been approved by the Bank of Greece.

Goldman Sachs and Morgan Stanley acted as global coordinators and bookrunners, joined by BofA Merrill Lynch, Citigroup, HSBC, UBS and Mediobanca.

NBG also plans to buy back 1.35 billion euros of preferred shares from the government. ($1 = 0.7183 Euros) (Reporting by George Georgiopoulos, writing by Angeliki Koutantou; editing by Jane Baird)

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