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Nearing the bottom of the crisis, Bouloutas says

08/03/2011 08:41
“The Greek economy is almost at the bottom of the crisis”, Marfin Popular Bank CEO, Efthimios Bouloutas said, stressing that even with a distant scenario of a hair cut on the Greek bonds, the bank has the capital to deal with the shock.

In his interview to StockWatch, Mr. Bouloutas said that Greece will sink to the bottom in the third quarter of 2011, which will be followed by a recovery.

“2011 will be a better year for Marfin in terms of growth due to the gradual recovery in Cyprus and the equalization of the Greek economy”, he noted.

“Despite the gradual improvement of the macroeconomic sizes in Cyprus and Greece, the bad debts will continue to increase in 2011 and possibly in early 2012 in both countries”, Mr. Bouloutas added.

CPB strengthened its capital by €0.5 billion few weeks ago, while it intends to issue convertible bonds of €0.6 billion by the end of 2011.

Mr. Bouloutas estimated that the bank has sufficient capital to deal with the macroeconomic shock in Greece and to absorb a hair cut of 50% on the Greek bonds.

“As a Group we believe that there will be no hair cut on the Greek bonds. But even if it is, Marfin will not need of additional capital”, he stated.

The ideal merger

In his interview to StockWatch, Mr. Bouloutas also talked about the merger scenarios in Greece and described the profile of an ideal “marriage”. “Although there is no merger scenario for Marfin at the current stage, a suitable merger would be with a bank that doesn’t need the support of the state or the European Central Bank”, he said.

“Marfin might acquire a bank abroad in the middle term, recognizing the prospects that emerge from the recovery of the economies of the Eastern countries”, he added.

Cyprus is the “corner-stone”

Five years after the big changes in the ownership regime of Laiki Bank and its triple merger with Marfin and Egnatia in Greece, Mr. Bouloutas said that the bank would be in a worse position if this merger never occurred.

He outnumbered the positive changes in the past few years with the increase in the assets, the expansion of its geographical presence and the synergies that emerged with Cyprus.

He believes that Cyprus is the “corner-stone” of the bank’s strategy and stressed that the energy developments in the area change the data for the banks too. He supported that the discovery of Leviathan by Israel changes the development prospects of the wider area itself and sees that the banks will play an important role in the regional energy charter.