Piraeus Financial Holdings said on Wednesday it had clinched a deal to buy 90 percent of Greek insurer Ethniki Insurance from CVC Capital Partners for 600 million euros.
Piraeus, one of Greece’s four largest banks said last month it was in exclusive talks to acquire Ethniki Insurance, which is expected to increase fee revenues to 30 percent from about 20 percent last year.
The deal “is expected to further diversify the revenue sources of Piraeus, enhancing value creation for shareholders, while it will complement our product range, covering the whole spectrum of banking, protection and investment solutions,” the Greek bank said.
CVC, which manages assets worth 191 billion euros, bought a 90 percent stake in Ethniki Insurance, the country’s second-largest, from the National Bank in 2021.
Ethniki Insurance is a leading composite insurer in Greece, covering the whole spectrum of insurance products with a circa 14.5 percent market share (circa 17 percent in life / circa 11 percent in non-life) and more than €0.8bn Gross Written Premiums (“GWP”), as of 2024.
Ethniki has €4bn total assets and €0.4bn shareholders’ equity, as of 2023. Ethniki Insurance reported a profit before tax adjusted for non-recurring items of approximately €100mn in 2023 (latest public data).
Ethniki’s production network extends throughout Greece and consists of owned sales network offices and corporate network insurance agents, as well as collaborating insurance agencies and insurance brokers. The GWP generated by the aforementioned channels comprises the vast majority of the Ethniki Insurance total production, with the remaining coming from its bancassurance channel.
Piraeus Bank estimates that based on the above, and including a 50 percent distribution payout out of 2025 results and onwards per annum, Piraeus’ proforma total capital position is estimated at circa 18.5 percent for 2025, anticipated to reach circa 19.5 percent by 2027 and circa 20 percent by 2028.
This impact translates into a capital ratio with a comfortable Pillar 2 Guidance buffer of circa 250bps in 2025, evolving to above 300bps by 2027 and close to 400bps by 2028. Throughout the period, Piraeus’ CET1 ratio is expected to sustain a level of 13 percent and higher.
Piraeus intends to achieve a Financial Conglomerate (FICO) status and pursue the application of CRR article 49 (commonly referred to as Danish Compromise) in relation to the prudential treatment of its participation in the share capital of Ethniki Insurance, which, if attained, would expand further our CET1 ratio by circa 50bps.
Piraeus’ financial guidance for the period until 2028, as communicated earlier this year to the market, is being upgraded, considering the anticipated impact of the acquisition.
Last month S&P Global Ratings upgraded the credit ratings of four Greek banks, the National Bank of Greece, Eurobank, Piraeus and Aegean Baltic Bank, and affirmed the rating of Alpha Bank, citing the stronger institutional environment and the improved capital quality of the sector.
The performance of the four systemic banks – Alpha Bank, Eurobank, National Bank of Greece, and Piraeus Bank – has led to increased earnings forecasts and dividend payouts for the year. They are collectively projected to achieve net profits of €4.5 billion in 2025.
During the January-September period, the four banks recorded combined profits of €3.49 billion, a 22.66 percent increase compared to €2.85 billion during the same period last year.
Related: Greece Sells Entire Stake in Piraeus Bank
