— Rights issue fully covered 1.11 times —
Marfin Popular Bank said this week that its 488.2 mln euro rights issue was fully covered and oversubscribed by 1.11 times, giving its capital adequacy ratios a boost, with analysts suggesting later that the successful rights issue indicate a fresh dynamic in the stock’s short-term momentum.
Marfin Popular made the cash call to strengthen its balance sheet given challenging conditions in Cyprus and a sizeable exposure in Greece, which is in its third straight year of recession.
"The successful completion of the increase in share capital allows the group to fully streamline its capital structure with its strategic business aims and the upcoming Basel III capital requirements," CEO Thymios Bouloutas said in a statement.
These include expansion in emerging European markets and strengthening its leadership position in Cyprus. The bank said the capital increase boosted its Tier 1 and total capital adequacy ratios by 180 basis points. This corresponds to a Group Tier I and Total Regulatory Capital base of EUR 3.3 bln and EUR 3.8 bln, respectively.
“The daily chart shows a short-term upward trend that started in January and continues to today,” Kyriakos Kakofengitis, director of YesFX, wrote in a report published in the Financial Mirror on Wednesday.
“The bullish ascending triangle suggests a continuum of the upward trend, subject to the stock breaking past the short term resistance point at EUR 1.15. Any break above 1.15 could see the stock price achieving a technical target of 1.45,” he added.
Last month Marfin Popular, along with Bank of Cyprus and Hellenic Bank, was placed on review for a possible downgrade by credit rating agency Moody's.
Moody's warned Cyprus it could cut its Aa3 sovereign credit rating, citing the island's deteriorating fiscal standing and banks' high exposure to Greece.
Marfin Popular's shares were up 2.8% in Athens on Monday, outperforming the Greek bourse's banking index which was trading 0.6% firmer.
In late January Marfin agreed to sell an 85% stake in its Australian unit Laiki Bank to Bank of Beirut for 104 mln euros.
