Do they have an ace up their sleeve at Alpha Bank?

Any possibility of getting the administrations of the National and Alpha Bank back on track and close to a deal, was eliminated yesterday in a letter to the Alpha staff, signed by Giannis Kostopoulos, where he invokes once again the unpredictability of the current circumstances as the main criterion for responding negatively to a friendly takeover proposal from NBG.

New proposals on the part of NBG have been excluded since Sunday, although a tender offer would cause the administration of Alpha Bank to convene an emergency general meeting of shareholders in order to put the proposal under consideration.

The categorical refusal of the Kostopoulos-Matzounis administration disappointed many in banking and the stock market, satisfied the union and began a new round of scenarios for future developments in the banking industry.

NBG says they’re surprised by Alpha’s refusal, foreign analysts and the international finance press have been in favor of the merger, from the Greek market the president of Piraeus Bank, with a statement in Reuters, estimates that such a merger would be profitable for the banking industry. «I think if they agree it will be a positive development for the economy in general and the banking sector in Greece» he said.

Contacts with executives

Kostopoulos has scheduled a meeting of executives today in order to explain to them the reasons that informed his decisions, in an attempt to improve the morale of the staff and the climate in Alpha due to the fact that it was the target and not the arrow, which would fit more the idea of the mighty organization that chooses and does not get chosen.

Although on Sunday night a member of Alpha insisted that the only main difference is the price, other sources talk of different views and disagreements between board members.

Specifically, Kostopoulos seems to have agreed to the new bank, as he would have been head of one of the largest banking organizations in SE Europe. CEO Mantzounis seems to have had a different opinion, wanting to secure many execs under him.

But this difference at the high echelons would have occurred at a lower level too as members of other banks spoke of a necessary slaughter that would have meant redundancy for at least 3.000 people.

The alternative scenarios

Many, however, explain the refusal from Kostopoulos-Mantzounis as serious evidence of an alternative course. Scenarios are coming and going.

Some think that Alpha is returning to negotiations with Eurobank of the Latsis group, which have stuck to the strong share position that the group would have occupied, something that frightens the powerful yet minor shareholders, Kostopoulos and Matzounis. This is logical if one considers the experience from the absorption of the Labour Bank by Eurobank.

Another scenario is talking about a cooperation possibility with a large foreign bank. The past talks with BNP Paribas and other big banks are known. This scenario is strengthened by the reiteration of the statements about insecurity in Greece that alludes directly to the dangers of NBG in case of a haircut due to the large quantity of bonds it possesses.

The third way is that of raising capital and the autonomous – for now at least – course of Alpha. But this course will not be easy especially in case the ECB, as all indications show, posits an issue of Greek banks detaching themselves from it, which has been the only source of liquidity for the banking system for more than a year now .

But while the merger was sinking completely and despite the attempts of the government, foreign investors and the BoG for the two sides to reach an agreement, the Finance vice minister, D. Kouselas, a man experienced in banking issues, stated that the system above all must try to deal with the situation, provide the possibility of increased liquidity for market needs and at the same time support the attempts of the country for development and its exit from the recession.

“Some things are insurmountable taboos”

After the latest developments everybody is speculating about the reasons that Alpha triumphantly rejected the objectively good proposal by NBG. Maybe the explanation is simpler than what most people think and could be found in the opinion of LAOS representative, K. Aivaliotis, who said yesterday that «in life there are some insurmountable taboos. The banking system could not be an exemption. Kostopoulos, having spent his lifetime in Alpha Bank, cannot leave it now and watch it from afar».

Everyone in their own way are preparing for the next day because as a powerful banking agent says, «the lid is off» and it is certain new things will pop out, possibly sooner than we all thought.