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According to Kathimerini's Panayiotis Rougalas, Eurobank has made significant strides in its investment in the Cypriot banking sector, particularly with its ongoing acquisition of Hellenic Bank. By the end of 2024, Eurobank's total investment in Cyprus is expected to surpass €1.1 billion, with a final figure of around €1.2 billion when it acquires the remaining 6.53% of Hellenic Bank by February 2025. This acquisition has turned out to be more expensive than initially planned, but it signals a growing belief in the value of Hellenic Bank and Cyprus's economy.
In recent months, Eurobank has bought significant shares of Hellenic Bank, including 21.33% from Dimitra Investment for €426 million, and 3.33% from Logicom for €66 million. The bank also purchased shares from the trade union ETYK, with an initial transaction worth €243 million, which will later increase to €256 million, reflecting the increased value of Hellenic Bank shares.
The price per share for these recent purchases has significantly surpassed previous estimates. Eurobank paid up to €4.84 per share, well above the original €2.56 per share from a public offer in the summer. This surge in share value comes after the recent leadership changes at Hellenic Bank, with new executives like CEO Michael Louis and others, who have worked to reveal additional value within the bank.
The move is a clear demonstration of Eurobank’s long-term confidence in the Cypriot economy. CEO Fokion Karavias had earlier stated that the investment would likely be the largest cash investment ever made by a non-Cypriot group in Cyprus, reflecting the bank's strong belief in Cyprus' economic prospects.
Following Eurobank's deal with Dimitra Investment and Logicom, Mr. Varnavas Irinaros will have nearly half a billion euros in cash available for new investments by February 2025. At the Bank of Cyprus (BOC) Annual General Meeting (AGM) last May, he played a prominent role. Irinaros is already a shareholder in the Bank of Cyprus, but with almost 500 million euros at his disposal, he could become the bank's largest shareholder and easily acquire a 9.9% stake — a threshold that doesn't require special regulatory approval. This is all assuming he continues to play a leading role in Cypriot banking.
The current market value of the Bank of Cyprus is around 2 billion euros, which corresponds to 446 million shares. With the 500 million euros, Irinaros could purchase up to 111 million shares at 4.5 euros per share, effectively acquiring one-quarter of the bank. While this would be a complicated supervisory process, a 10% stake is a more feasible scenario and one we may see in the future. It's also worth noting that after the transaction with Eurobank, ETYK went on to purchase additional shares in the Bank of Cyprus.
**This story was originally based on a translation of Panayiotis Rougalas' article in Greek, published in Kathimerini Cyprus. However, the initial translation contained inaccuracies that led to misleading information. The article has now been updated to provide an accurate reflection of the original Greek content.
