All four core lenders have now issued bonds

By Evgenia Tzortzi

Eurobank’s 500-million-euro four-year bond issued on Thursday was more than twice oversubscribed as orders totaled 1.1 billion euros at an interest rate of 4.25 percent. This completes the set of all four Greek systemic banks to have successfully issued bonds as the Greek economy reverts to normality.

Eurobank sources said the issue confirmed the international investment community’s interest in the lender, as was also the case during its successful recent 2.9-billion-euro share capital increase. There was significant activity on the part of long-term investment funds, which illustrates the return of all categories of investors to the Greek market.

The decision to opt for a four-year bond was the outcome of contacts with international investment firms during Eurobank’s recent roadshow, when the market had expressed a need for the creation of a reliable range of interest rates for Greek banks to serve as a yardstick for the pricing of future issues by banks and other Greek enterprises. In the last few months banks Piraeus and Alpha have issued three-year bonds, while National went for a five-year paper, meaning that Eurobank completes the range of available yields.

In drawing medium-term liquidity, Eurobank is further bolstering its cash reserves so that it can smoothly cover the expected requirements for the funding of the Greek economy. This follows recent decisions by the European Central Bank aimed at strengthening liquidity and assisting growth on a continental level.

Eurobank’s chief executive Christos Megalou expressed confidence that the Greek economy is very close to returning to growth during a speech in Cyprus earlier this week. The gradual recovery, Megalou said, will likely begin in the upcoming...

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