Deputy CEO: Eurobank aiming for “full control of Hellenic Bank in Cyprus”

Stavros Ioannou, Eurobank’s deputy chief executive officer, group chief operating officer and head of international activities has revealed that Eurobank would like “to have full control of Hellenic Bank in Cyprus at some point.”

Speaking in an interview with Bloomberg, Ioannou also shared that Eurobank wants to turn Cyprus into a hub to serve new markets.

According to Bloomberg’s article, Eurobank Ergasias Service and Holdings SA plans to expand its activities to new markets including Saudi Arabia, Dubai, India and Israel, targeting wealthy clients as the Greek lender seeks to increase profits from international activities.

“In order to be successful we need to grow our footprint and this can only be achieved when you increase the markets where you operate,” said Ioannou, is quoted as saying, adding, “These are still under development wealth management markets that you have to enter early enough to grab the potential and the opportunities.”

As reported by Bloomberg, “Eurobank’s heightened ambitions are a further sign of recovery in the nation’s financial sector, after a decade-long debt crisis left the banks saddled with over a hundred billion euros in bad loans by 2016. In line with its domestic peers, the lender’s share price has risen by almost 46% this year, aided by the expectation that the nation will soon regain investment-grade status.”

The media outlet also noted that, “Eurobank already has a presence in Cyprus, Luxembourg, Bulgaria and in London, while it recently acquired BNP Paribas’s Personal Finance unit in Bulgaria adding €400 million ($435 million) in loans and €100 million of new deposits.”

On Hellenic Bank, Bloomberg reported that Eurobank has” also increased its stake in Cyprus’s second-largest lender, Hellenic Bank Pcl, to 29.2% and aims to further raise its holding soon.”

“The lender already has its own subsidiary on the eastern Mediterranean island and wants to turn Cyprus into a hub to serve the new markets,” the report continued, quoting Ioannou as commenting, “We have a regional role to play both as a Greek bank and through our Cypriot subsidiary, due to proximity Cyprus has to markets like India, Israel, Dubai and Saudi Arabia.”.

He didn’t exclude the possibility of having a representative office “in some of those countries,” Bloomberg’s article continued.

At the same time, Eurobank would also like “to have full control of Hellenic Bank in Cyprus at some point,” according to the deputy CEO, as reported by Bloomberg.

“The lender has received the relevant approvals from the European Central Bank’s supervisory arm to buy back the Greek state’s stake in Eurobank. The Hellenic Financial Stability Fund, Greece’s bank recapitalization fund that was established at the start of the country’s bailout programs, holds a 1.4% stake in Eurobank. The fund has announced its plan to divest from Greek lenders and Eurobank is moving forward with the necessary procedures to acquire the stake by using the amount earmarked for dividend distribution in 2023,” the media outlet reported.

Bloomberg also said, “Income from Eurobank’s international operations represented 33% of total group earnings at end-May, from around 25% in 2022. By September the lender will have finalized its strategy and from the new year will start on the implementation phase of its expansion plan.”