(Updates with share reaction, first-quarter results)
LONDON, May 24 (Reuters) - Alpha Bank, one of Greece’s four largest lenders, plans to raise about 800 million euros ($975 million) in a sale of new shares to capitalise on lending opportunities at home as European Union recovery funds will flow in, it said on Monday.
The strategy update helped the bank’s shares rebound from a plunge of about 30% on Friday, rising 8.1% to 0.9764 euros in early Monday trade.
The planned share sale will take place via a bookbuilding to international institutional investors and a public offering in Greece, targeting completion by mid-July, the bank said.
Alpha Bank, about 11% owned by Greek bank rescue fund HFSF, said current shareholders’ preemptive rights to the offering would be cancelled but priority would be given to existing shareholders.
The Hellenic Financial Stability Fund (HFSF) will participate up to its current holding.
Alpha Bank sees investment-driven growth ahead and wants to be well positioned for that.
“Greece will shortly benefit from a once in a generation inflow of EU funds that will create a major boost to the economy,” CEO Vassilis Psaltis said in a statement.
He said that Alpha Bank expects significant investment in clean energy, digitalisation, real estate, tourism and infrastructure. The capital boost will help it to grow “as the leading bank partner to this transformation”, he added.
Greece formally submitted its national recovery plan to the EU last month, hoping to boost economic growth by as much as seven percentage points over the next six years.
Under the multibillion-euro coronavirus recovery package agreed by EU leaders last year, Athens is to receive 18.2 billion euros in grants and 13 billion euros in cheap loans over the coming years, equal to about 16% of its gross domestic product.
Goldman Sachs and JPMorgan will act as joint global coordinators and joint bookrunners for the offering, with Citigroup the senior joint bookrunner and Barclays and Axia Ventures as joint bookrunners.
Alpha Bank, with a Core Equity Tier 1 ratio of 16%, reported a loss of 282 million euros ($343.98 million) in the first quarter, widening from a loss of 29.7 million in the same period last year, after loan-loss provisions rose 31.4% to 390.6 million euros.
The bank said most of the impairment charge was a result of the hit taken on sales of non-performing loans in Cyprus. ($1 = 0.8198 euros) (Reporting by George Georgiopoulos and Lefteris Papadimas Editing by Mark Potter and David Goodman)