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Greek lender Piraeus Bank has agreed to acquire a 90.01% stake in the parent company of compatriot Ethniki Insurance from CVC Capital Partners Fund VII (CVC).
The transaction, valued at €600 million in cash, is subject to regulatory approval.
Last month, the bank entered exclusive talks with CVC.
Ethniki Insurance holds a market share of approximately 14.5%, with over €800 million in gross written premiums recorded in 2024.
The acquisition is expected to diversify Piraeus Bank’s revenue streams and enhance its product portfolio, which includes banking, protection, and investment solutions.
Piraeus Bank estimates the deal will increase its earnings per share by 5% and boost its return over average tangible book value by one percentage point.
Its proforma total capital position is projected to reach approximately 18.5% in 2025, growing to around 19.5% by 2027 and 20% by 2028.
The bank also anticipates maintaining a “comfortable” Pillar 2 Guidance buffer and sustaining a Common Equity Tier 1 (CET1) ratio of 13% or higher during this period.
As part of its efforts to achieve financial conglomerate status, Piraeus Bank plans to apply for prudential treatment of its stake in Ethniki Insurance under CRR Article 49, known as the Danish compromise.
If approved, this could further increase the bank’s CET1 ratio by 50 basis points.
In 2023, Ethniki Insurance reported total assets of €4 billion and shareholders’ equity of €400 million. The company also recorded an adjusted profit before tax of approximately €100 million that year.
UBS Europe is serving as the financial advisor to Piraeus Bank for the transaction, with Milliman acting as the actuarial advisor.
Legal and competition counsel is being provided by Milbank, Moratis Passas Law Firm, and Potamitis Vekris Law Firm.
In 2022, CVC acquired a 90.01% stake in Ethniki Insurance from the National Bank of Greece.
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