Piraeus chairman resigns as Greek banks overhaul boards

ATHENS (Reuters) - The chairman of Greece’s Piraeus Bank resigned on Wednesday, the first of an expected procession of board-member departures at Greek banks after the country’s international lenders demanded they improve corporate governance.

CEO of Piraeus Bank Michael Sallas addresses reporters during a news conference in Athens July 15, 2010. REUTERS/Yiorgos Karahalis

Michael Sallas, who led Piraeus to become Greece’s largest bank by assets through a series of acquisitions in recent years, said he was stepping down after 25 years at the helm and despite a “positive assessment” from Greece’s HFSF bank bailout fund.

“After the last recapitalization a new financial landscape is shaping up. In this new environment, along with the experience of old managers, the strength of new people, new managers is needed, to steer the bank in the new era,” he said in a statement.

Greek lenders have traditionally had businessmen, union leaders and in some cases politicians on their boards. But under its third international bailout, Athens agreed to try to ‘de-politicise’ links between government and banks, and boost board-level expertise.

Bankers with knowledge of the matter have said a third of Greek bank board members could go by September.

Piraeus Bank said it had appointed board member Haroula Apalagaki as interim chairwoman. Its board also unanimously decided to name Sallas honorary chairman.

Sallas turned Piraeus from a small lender with a 0.1 percent market share in 1991 into a bank with a 30 percent market share now, as well as 19,000 staff and subsidiaries in the Balkans.

Piraeus Bank officials said Sallas had informed authorities of his intention to step down as chairman at the start of the year, but awaited the completion of an evaluation of Greek banks’ boards by the HFSF bank rescue fund.

HFSF hired external consultants to carry out the assessment.

Piraeus Bank, with a market value of 1.42 billion euros ($1.56 billion), expects to return to profitability this year, Sallas projected in May.

Reporting by George Georgiopoulos; Editing by Mark Potter