Piraeus snaps up Greek units of Cypriot lenders in €524m rescue

 
City A.M. Reporter
GREECE’S Piraeus Bank has agreed to buy the operations of stricken Cypriot banks in Greece for €524m (£444m), the lender said yesterday, in a deal hastily cobbled together to protect the Greek banking sector from the island’s debt crisis.

The deal, funded by Greece’s bank bailout fund HFSF, means 312 local branches of the three Cypriot banks will reopen today after being shut since 19 March as Cyprus scrambled to strike a bailout deal to prevent an economic meltdown.

The transfer of the branches, which represent about a tenth of Greece’s banking market, was part of Cyprus's international bailout deal to help shield Greek lenders from the island's crisis and allow Cyprus to shrink its bloated banking sector.

Piraeus beat out rival Alpha Bank to acquire the Greek operations of Bank of Cyprus, Cyprus Popular Bank and Hellenic Bank. A bank source with direct knowledge of the deal said the enlarged Piraeus would have too many branches and could achieve synergies by closing as many as 500 over the next three years.