By Nicolas Bornozis
The Greek stocks fell this week, for the fourth consecutive week, with the index closing 2.08% down at 2039.38. The average daily volume was formed at 137 million Euro compared to 206 million Euro the previous week. The midcaps under-performed on the back of program selling orders as well as some blue chips due to absence of major buying flows. The FTSE ASE 20 Index fell 21.83 points to 1025.95, while the FTSE ASE Midcap 40 index fell 1.39% to 217.16.
The chairman of the council of economic advisors, Mr. Rapanos, announced this week that Greek economy is expected to grow by 4% this year and 4.2% in 2004. The expansion in the economy is attributed to the gradual pickup in the EU growth, the anticipated positive effects of the 2004 Olympics, and the inflows from the EU. The new figure is in line with IMF forecast of 4% (2003) but stands above IMF’s 3.9% GDP growth projection for 2004 released. Mr. Rapanos also stated that government deficit will stand around 1.1-1.2% of GDP, exceeding original target of 0.9%, mainly due to additional expenditures related to natural disasters and less revenues from easing tax rates in cars.
The Bank of Greece reported this week that the current account deficit for the period January-July 2003 increased 17.6% to €5.77bn, while it is expected to reach 6.6% of GDP by the end of 2003 versus 6.1% of GDP in 2002. Public expenditures have exceeded the 2003 State budget target by €1.5bn. As a result, budget deficit stands at 7.2bn for the first 7 months of the year. FY03 budget deficit target stands at €5.3bn.
Piraeus Bank S.A.
Within the framework of its strategic expansion in international markets and the enhancement of its international banking activities, Piraeus Bank Group, through its subsidiary in New York, Marathon Banking Corporation, proceeded with the execution of an agreement for the acquisition of 98.56% of Interbank N.Y. As a commercial bank in New York, Interbank operates a network of 5 branches in New York City, and specifically in Brooklyn, Astoria, Queens, as well as in Park Avenue, downtown Manhattan. In June 2003, Interbank’s total assets amount to approximately USD 282 million, deposits to USD 257 million and loans to customers to USD 140 million. During 2002, Interbank realised pre-tax profits of USD 4,7 million, delivering over 21% pre-tax ROE. The scope of this strategic move of Piraeus Bank Group, is the merger between Interbank and Marathon Bank, due to the complementary nature of its branch network and due to both banks’ specialization in the market segments of commercial residential lending and retail banking.
The merger of the two Banks will create significant economies of scale and will result to a Bank with a total asset size of USD 600 million, standing as an important business opportunity to further enhance Piraeus Bank Group’s presence in New York.
National Bank of Greece Group
Atlantic Bank of New York, the subsidiary of National Bank of Greece in the U.S.A., has announced the signature of a definitive agreement with Allied Irish Banks, plc, whereby Atlantic Bank will purchase all deposit accounts, safe deposit boxes and certain consumer and business loans located at AIB’s 405 Park Avenue branch office. The above transaction is in line with NBG’s strategic goals for enhanced competitiveness and expansion in the crucial and highly demanding market of New York. The AIB branch has many years of continuous presence in the heart of Manhattan and owns deposits that exceed $ 210 million.
Coca-Cola Hellenic Bottling Company S.A.
Coca-Cola Hellenic Bottling Company S.A. announced that the Extraordinary General Meeting of its shareholders which was held in Athens, Greece on 15 September 2003 approved a share capital increase of 518,304,225.24 Euro through the capitalization of a portion of the account balance from the issuance of shares above par value, thus increasing the nominal value of each share of the company by 2.19 euro.
The company has also successfully completed, through Coca-Cola HBC Finance B.V., the sale of a two-tranche $900 million bond offering which was heavily oversubscribed.
Proceeds from the offering will be used to finance the leveraged re-capitalization plan of Coca-Cola Hellenic Bottling Company S.A. that was announced on August 19, 2003 and to refinance certain existing short-term and long-term debt.
Intralot has announced the establishment of Libero SA, a new subsidiary in Turkey. Libero SA is a joint company of Intralot and Turkcell group, the leading mobile operator of Turkey. The new company’s main activity is to provide sports betting services via alternative channels: mobile phones, call centers, digital TV and the Internet. For this purpose Intralot, in co-operation with local companies, will develop a system, which will support these services and will be adapted on ‘Sportoto’s’, (the National Football Prognostics Organisation of Turkey), LOTOS platform. Libero SA is allowed to provide its services by using Turkcell’s network, which has a 70% market share.