Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Greek bank shares plunge for third day, drag down broader market

Stock Markets Aug 05, 2015 12:28PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. A man walks inside the Athens Stock Exchange in Greece

By George Georgiopoulos and Jeremy Gaunt

ATHENS (Reuters) - Greek bank shares sold off sharply for the third day in a row on Wednesday with buyers yet to emerge on a scale large enough to counter continued dumping of the stocks.

The Athens bourse's banking index (FTATBNK) ended 27 percent lower, bringing the three-day plunge since Monday's open to 63 percent. The rout dragged the wider market (ATG) down 2.5 percent although non-financials generally outperformed banks.

"With bank shares continuing their dive for a third day in a row, the rest of the market's effort to stabilize was dampened. A tail of unexecuted sell orders on shares of Alpha and Piraeus indicate there may be more pressure on Thursday," said Takis Zamanis, chief trader at Athens-based Beta Securities.

Alpha (AT:ACBr) and Piraeus Bank (AT:BOPr) both closed 29.6 percent lower, effectively at the 30 percent daily loss limit. The former has 1.06 million shares on offer and the latter 2.8 million shares. There were no buyers for either.

But peers Eurobank (AT:EURBr) and National Bank (AT:NBGr), which also fell sharply, attracted buyers towards the close, ending down 26.7 and 24.3 percent, respectively.

Greek banks are in dire need of recapitalization after a flight of euros from deposits for most of this year and mounting bad loans. But that will hurt existing shareholders, when it comes, by diluting the value of their holdings.

Athens and its international lenders share the view that banks must complete their recapitalization by the end of this year and avoid a haircut on large depositors, the country's finance minister said on Wednesday.

The European Central Bank is intensely monitoring Greek banks and any capital shortfall identified in an upcoming review could be plugged using part of the country's bailout money, Daniele Nouy, the ECB's banking supervision chair, said.

Banks comprise about 20 percent of the main Athens index (ATG) and their continued plunge dragged it lower, reversing a small opening gain.

The new price levels mean big losses for bank shareholders, including Greek bank rescue fund HFSF, which holds majority stakes in three of the four big lenders, hedge funds and other long-term foreign investors.

Foreign market participants accounted for about 67 percent of stock market turnover on Tuesday, a senior Athens stock exchange official told Reuters.

Some shares in the Athens bourse's large-cap share index (ATF) managed to rebound, however, with 13 of its 25 constituent stocks scoring gains on Wednesday.

"The market is looking for the bottom. We are not far away from it," said Alexander Moraitakis, head of Athens-based Nuntius Securities. "But bank shares are still pounded by selling pressure due to dilution fears, given their need to recapitalize."

Greek bank shares plunge for third day, drag down broader market
 

Related Articles

Tesla Cuts Waiting Times in China to Minimum 4 Weeks
Tesla Cuts Waiting Times in China to Minimum 4 Weeks By Investing.com - Aug 18, 2022

By Michael Elkins  Tesla (NASDAQ:TSLA) is seeing positive movement in early trading on Thursday after the company announced that they were cutting the delivery waiting period for...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email