FINANCE: Astrobank in deal to buy National Bank of Greece (Cyprus)

Astrobank has come to an agreement in principle for the acquisition of the National Bank of Greece (Cyprus) after months of negotiations in Athens and Cyprus.

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Sources from both banks quoted by Stockwatch have confirmed that the two sides are close to a final agreement.

While details of the deal have yet to be announced, it is believed that the takeover deal was facilitated by efforts made by NBG Cyprus to package and sell off NPLs.

Astrobank had initially requested that NBG Cyprus should present a clear balance sheet at the negotiation table.

NBG announced in its financial results for the second quarter of 2019 that non-performing loan sales -including a portfolio of secured business and retail loans in Cyprus – of €400 mln.

As a result of loan sales, the bank's NPL ratio has fallen from 62% in 2017 to 12% in 2018.

According to reports, the buyer of NBG Cyprus’ NPL packages is APS which has also bought a similar NPLs package from Hellenic Bank.

The deal with NBG Cyprus follows Astrobank’s recent takeover of Universal Savings Bank (USB) which had assets of €687 mln, €325 mln worth of loans and some €603 mln in deposits.

The bank belongs to the Senhaoui family from Lebanon which had initially acquired Piraeus Bank, renaming it Astrobank and announcing that they would be acquiring other banking institutions on the island as part of their growth strategy.

NBG Cyprus has been present on the island since 1910 and maintains 10 branches.

It’s total assets are approximately €800 mln, outstanding loans amount to €747 mln with deposits around €572 mln.

In 2018, NBG Cyprus reported profits of €4 mln compared to a loss of €8 mln in the corresponding period of 2017.