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U.S. investment fund is interested in the broken Proton Bank

24 August 2011 / 18:08:54  GRReporter
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A Greek-American investment fund, which manages € 450 million and the CEO of which is a former Greek banker, is willing to acquire a significant share of the troubled Proton Bank. This is what a senior official of Proton reported to Reuters, who wished to remain anonymous. It was found that the bank, managed until recently by Lavrentis Lavrendiadis, has been granting loans to 8 different companies belonging to the same businessman under conditions that could cause property damage to its depositors.

The same source said that the bank would increase its capital in the next couple of days or weeks at most. At the end of last week, the four major Greek banks - National Bank of Greece, Alpha Bank, Eurobank EFG and Piraeus also expressed their willingness to invest in Proton. The four banks will invest € 50 million into the troubled financial institution and will become a kind of its "guardian." Proton currently has 31 branches, capitalization of € 24 million and a turnover of € 3.8 billion, according to data from the first quarter of 2011.

The four major based their decision on the change in the board of managers. "The new Board of Managers of Proton consists of professionals with extensive banking experience and the Bank of Greece has full confidence in them," said the official announcement of the Greek central bank. It should be noted that it has appointed a commissioner in the troubled bank, who will be in aid of the new governing body on the one hand and will provide for the proper development of the institution on the other.

Meanwhile, the gloomy results for the Greek economy the GDP of which is expected to shrink by 5.3 per cent in 2011, the inability of George Papandreou’s government to stabilize the state budget and reduce its deficit below 10 per cent despite the huge cash inflows from the outside and the growing centrifugal forces in the euro area are taking the Athens Stock Exchange to a collapse. Today its index fell below new psychological barrier - 900 points and stopped at 898.41 points, which is 3.23 per cent daily decline. For the same reasons, the spread-index of 10-year government bonds marked a new historical record of 1608.1 bps.


Tags: Proton BankLavrentis LavrendiadisU.S. investment fundEconomic crisis
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