Greece Nationalizes 2 Largest Banks
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Photo by EPA/BGNES
The Greek government announced Monday it will have to nationalize the two largest banks in a bid to stabilize them.
The National Bank of Greece and Eurobank Ergasias will have to go under the control of the state Fund for Financial Stability, after restructuring talks failed.
It was hoped that the two banks could be merged and recapitalized with funds gathered by their own board.
In February the National Bank purchased Eurobank, but the merger procedure has not been completed and is now frozen.
The central Bank of Greece assured that recapitalizing the bank will go in order and is expected to be completed by end of April.
In Bulgaria, the National Bank of Greece owns the United Bulgarian Bank, while Eurobank Ergasias owns Postbank.
The Greek government was pressed by the so-called troika of international creditors - the European Commission, IMF and World Bank - to urgently resolve the situation with the two banks.
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