Hellenic Financial Stability Fund mulls divestment from banks

Within the day, the Ministry of Finance is expected to submit to the Hellenic Financial Stability Fund (HFSF) its observations on the study of its disinvestment from Greek banks, which was drawn up, with Rothschild as its advisor.

The government’s goal is to return the final text, after the corrections expected to be requested, immediately for approval to the Ministry of Finance, so that it can be finalized by the end of the year.

In this way, it is estimated that it will be possible at the beginning of 2023 to start the sale process to private investors of the shares held by the Fund in at least two of the four systemic groups, for which there are proposals.

It is recalled that his participation currently amounts to: 40% in National Bank, 27% in Piraeus Bank, 9% in Alpha Bank and 1.4% in Eurobank.

Timing

The truth is that in recent months the interest in the domestic bank sector has increased, due to the prospects of its return to high and sustainable profitability and given the more favorable macroeconomic environment in Greece, compared to the rest of the Eurozone.

For this reason, the government considers that it is in the interest of the State that the relevant transactions proceed as soon as possible.

The argument against those who call today’s valuations low is that in the current climate of heightened uncertainty, it cannot be ruled out that market conditions could deteriorate further.

It is noted that the divestment study will include a range of options for the intended liquidation and then the disposal consultant will indicate the most advantageous way to proceed with the sale.

The solution of the competition

According to information, the solution of the tender will be qualified for National and Piraeus banks, where each interested party, including the Saudi Arabian State Fund which is interested in up to 20% of the former and the ION Group which has submitted a financial offer for the 27 % of the second, will be able to submit his proposal.

Based on what the legislation, the disposal consultant’s report should include the following:

– Suggest a specific transaction according to the divestment strategy

– Depict and evaluate the conditions prevailing in the market

– Suggest reasoned proposal of the most appropriate structure of the transaction

In addition, the report should be accompanied by a timetable for the disposal of the securities and provide for all the necessary actions to comply with it.

The new needs of the industry

Elsewhere, the managing director of the HFSF, Ilias Xirouhakis, speaking at the 20th Bank Management Conference, referred to the need of banks to redefine the customer service model, at the level of strategic planning, functionality, systems, organizational structure and corporate culture.

According to Mr. Xirouhakis, we are in an era where innovation in the banking industry is necessary to meet the ever-increasing demands of generation Z and beyond, as well as the new economic and geopolitical challenges in an extremely volatile and volatile environment”.

10 key priorities

In this context, he pointed out that the main priorities of banks for the near future should be the following:

1. Creating a digital identity of customers to better understand their real needs, balancing their seamless customer experience with the security of their personal data.

2. Investment in artificial intelligence (AI) technologies to collect real-time data from social media platforms and Voice of the Customer (VOC) programs, in order to constantly readjust the customer’s identity with real data.

3. Transition to open banking systems for APIs and their interconnection with end-to-end systems in the departments of crediting, customer service, credit risk control, delays with early warning systems, investment products, etc., setting the necessary and appropriate data security barriers and also the appropriate control mechanisms in all lines of defense.

4. Simplifying and speeding up decisions for new loans to existing or new corporate clients and individuals, reducing the time-to-yes and time-to-cash

5. Reduction of bureaucratic functions and interconnection with other cooperating bodies, such as the public, other credit institutions and other related ecosystems

6. Personalized products – moving from products designed based on customer sub-categories, to products tailored to the individual needs of each customer.

7. Optimizing the customer experience through the further strengthening of online channels – such as by redesigning the interoperability of individual support systems and the use of virtual banking assistants, while utilizing modern call centers and/or smart wallets

8. Rewarding consistent customers with refunds, but also other ways of encouraging further use of means of payment, such as reducing credit interest rates, the amount of subscriptions and other fees.

9. Providing a wider range of products and services as well as specialist advice on investments, pension solutions and real estate

10. Creation of embedded finance partnerships with new market players, to strengthen eg the credit offer from retail chains to all kinds of their customers.