Athens, 20 December 2010. Piraeus Bank’s Extraordinary General Meeting which convened today has approved Management’s recommendation for an increase in the equity capital of the Group and has further authorised, for purposes of greater flexibility, the Board of Directors to proceed with a capital increase and to determine the exact amount, as well as the other relevant issue terms.
The Board of Directors has decided to proceed with an increase in the equity capital for €800 million by offering pre-emptive rights to existing shareholders and will convene on 3 January 2011 to define the terms and issue process (number of new shares, offer price, etc).
Based on the Bank’s Management estimates, it is expected that the subscription period of the ordinary shareholders will end around the end of January 2011 and the new shares resulting from the rights issue will be listed thereafter.
The General Meeting has also resolved upon the reduction of the nominal value of the Bank’s ordinary shares to €0.30, according to article 4 of Codified Law 2190/1920, with the formation of a special reserve. This reduction is of a purely technical nature, does not affect shareholders’ equity, while no additional shares will be issued as a result.
Finally, the General Meeting has approved the issuance of convertible bonds for up to €250 million without pre-emption rights. The General Meeting has authorised the Board of Directors to determine the exact time and define the specific terms of the convertible bonds offering prior to any issuance. The conversion price of the bonds shall be higher than the volume-weighted share price of the 30 days prior to the issue date.
According to Piraeus Bank’s Chairman, Mr. Michalis Sallas, the proposed increase of the equity capital by €800 million aims to:
According to Michalis Sallas, Piraeus Bank Group Chairman of the Board of Directors, equity capital increase will strengthen the Piraeus Bank Group’s market position and will enable to use the attractive growth opportunities in the operating countries
The successful completion of the €800 million rights issue will enhance the capital adequacy and will result in 9.5% Equity Tier 1 Capital Ratio, 10.8% Tier 1 Capital Ratio and 11.7% Total Capital Adequacy Ratio (+200 bps pro forma as of 30 September 2010).
Piraeus Bank’s Management considers that the continued trust and support of the Bank’s shareholders, as further exhibited today with their strong participation in the General Meeting and the approval of the Board of Directors’ recommendations strengthens the Bank’s uninterrupted and dynamic course.
Note. Piraeus Bank is one of the major banking institutions of Southern and Eastern Europe with assets of EUR 57.6 bln and total equity of EUR 3.4 bln (as at 30.09.2010). Established in 1916, Piraeus Bank today has presence in Greece, Ukraine, Romania, Bulgaria, Albania, Egypt, Serbia, Cyprus as well as in the world financial centers of New York and London. Piraeus Bank S.A. leads Piraeus Bank Group, which consists of 10 banks and 21 companies covering the entire range of financial services.
In Ukraine Piraeus Bank provides a full range of banking services to individuals, small and medium enterprises and corporate clients.
Piraeus Bank is a member of Association of Ukrainian Banks, participant of the Fund of Guaranteeing the Deposits of Individuals. The Bank is also included in the list of banks authorized by the Pension Fund of Ukraine to make payments of pensions and financial assistance.
Piraeus Bank has the highest rating of deposits reliability provided by the independent rating agency Credit Rating (grade “5”), that shows the bank's capacity to make payments on existing deposits timely and in full.
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