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Citigroup Lowers Price-Targets For Greek Banks

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Citigroup has set new price-targets for six Greek banks in a report entitled “A Trim, Not a Haircut”.

According to the report, six Greek banks would need to raise €16bn of capital -€14bn for the Greek banks and €2bn for the Cypriot banks- to recapitalise the system to 8% Core Tier 1 ratio after the 50% mark-to-market and Basel 3 effects.

“We estimate that in 2Q11 the six banks under our coverage that have reported have lost €18bn of deposits”, said Citigroup.

More than two-thirds of this amount, or €13bn, was replaced by ECB and ELA funding at a cost of 1.5% and 3.5%, respectively (before overcollateralisation). 

Citigroup has increase price-target for ATEbank to €0.30 from €1.03, for Piraeus Bank to €0.45 from €0.75, for Hellenic Postbank to €1 from €2.25 and for National Bank to €3.50 from €7.75. 

Moreover, it downgrades estimates for Piraeus Bank to €-0.81/share from €-0.02/s, for Hellenic Postbank to €0.21/s from €0.35/s, for National Bank to €-1.47/s from €0.61/s and for ATEbank to €-0.19/s from €-0.29/s.
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