Wednesday, February 23, 2011

Bank mergers must be friendly, says Provopoulos

Yiorgos Provopoulos, an ECB governing council member, also said European Central Bank is in the process of gradually winding down extraordinary liquidity measures.
 
"As conditions in the euro zone normalise the tendency to exit extraordinary liquidity measures increases," Provopoulos told the Greek parliament's economic affairs committee.
 
"The ECB is in a phase of exiting extraordinary liquidity measures... Of course this will be gradual," he added.
 
Greek banks are heavily reliant on European Central Bank funding for liquidity, as access to wholesale funding remains mostly shut because of wider sovereign debt concerns.
 
Referring to a proposed buyout bid from Greece's National Bank for Alpha, Provopoulos said the central bank favoured bank mergers if they were well planned and friendly.
 
National Bank, the country's biggest lender, offered last week to buy Alpha, the country's third-biggest bank, in a "friendly" all-share deal.
 
"If mergers are well planned and friendly, they work," Provopoulos told a parliament committee. "We oppose non-friendly mergers," Provopoulos said.
 
Alpha rejected on Friday National's takeover bid, despite the government's repeated calls to lenders to consolidate to cope better with the country's debt crisis.


source: Reuters