UBS Investment Research said on Monday it expects more developments in the Greek banking sector, according to a report.
UBS noted that despite Alpha Bank’s rejection of National Bank’s bid on Friday, “the ball is now rolling and we would expect more developments on this front”.
The Greek banks are responding to the challenging environment and the call of the regulators and policymakers to consolidate.
“We have long argued that consolidation may prove to be beneficial to the Greek banking system and its shareholders”, said UBS.
Mergers will help create bigger financial institutions with more robust balance sheets. The resulting entities should have better access to capital markets, deliver synergies and should ultimately be significantly better placed to compete in Central and South Eastern Europe.
However, UBS states that each merger proposal has to be examined on a case-by-case basis to determine the extent and share of benefits between each of the banks’ shareholders, as mergers are no panacea for sovereign, liquidity and asset quality woes.
UBS noted that despite Alpha Bank’s rejection of National Bank’s bid on Friday, “the ball is now rolling and we would expect more developments on this front”.
The Greek banks are responding to the challenging environment and the call of the regulators and policymakers to consolidate.
“We have long argued that consolidation may prove to be beneficial to the Greek banking system and its shareholders”, said UBS.
Mergers will help create bigger financial institutions with more robust balance sheets. The resulting entities should have better access to capital markets, deliver synergies and should ultimately be significantly better placed to compete in Central and South Eastern Europe.
However, UBS states that each merger proposal has to be examined on a case-by-case basis to determine the extent and share of benefits between each of the banks’ shareholders, as mergers are no panacea for sovereign, liquidity and asset quality woes.
