Further to the announcement on 06 February 2025, Piraeus Financial Holdings S.A. informs the investment community that its subsidiary Piraeus Bank S.A. (“Piraeus”) has entered into a Share Purchase Agreement (hereinafter “SPA”) to acquire 90.01% stake in the parent company of Ethniki Insurance (the “Transaction”) from CVC Capital Partners Fund VII.
As per the signed SPA, the consideration for the Transaction is €600mn in cash, on a 100% basis.
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The Transaction is expected to further diversify the revenue sources of Piraeus, enhancing value creation for shareholders, while it will complement our product range, covering the whole spectrum of banking, protection and investment solutions.
The Transaction is accretive for Piraeus in Earnings per Share (EPS) by circa 5% and Return over average Tangible Book Value (RoaTBV) by circa 1 percentage point and it elevates fee generation to international best-in-class levels, while retaining our competitive cost efficiency aspiration.
Based on the above, and including a 50% distribution payout out of 2025 results and onwards per annum, Piraeus’ proforma total capital position is estimated at circa 18.5% for 2025, anticipated to reach circa 19.5% by 2027 and circa 20% by 2028. This impact translates into a capital ratio with a comfortable Pillar 2 Guidance buffer of circa 250bps in 2025, evolving to above 300bps by 2027 and close to 400bps by 2028. Throughout the period, Piraeus’ CET1 ratio is expected to sustain a level of 13% and higher.
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Piraeus intends to achieve a Financial Conglomerate (FICO) status and pursue the application of CRR article 49 (commonly referred to as Danish Compromise) in relation to the prudential treatment of its participation in the share capital of Ethniki Insurance, which, if attained, would expand further our CET1 ratio by circa 50bps.
Ethniki Insurance is a leading composite insurer in Greece, covering the whole spectrum of insurance products with a circa 14.5% market share (circa 17% in life / circa 11% in non-life) and more than €0.8bn Gross Written Premiums (“GWP”), as of 2024.
Ethniki Insurance has €4bn total assets and €0.4bn shareholders’ equity, as of 2023. Ethniki Insurance reported a profit before tax adjusted for non-recurring items of approximately €100mn in 2023 (latest public data).
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Ethniki Insurance’s production network extends throughout Greece and consists of owned sales network offices and corporate network insurance agents, as well as collaborating insurance agencies and insurance brokers. The GWP generated by the aforementioned channels comprise the vast majority of the Ethniki Insurance total production, with the remaining coming from its bancassurance channel.
Source – PR Newswire
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