By Adam Whittaker and Elena Vardon
UniCredit said it would double its stake in Alpha Bank to around 20%, deepening a partnership with one of Greece's largest lenders at a time when its expansion efforts are facing roadblocks.
The Italian bank has been on a buying spree in recent months under Chief Executive Andrea Orcel, though its approach for Commerzbank in Germany has been met with political opposition while its unsolicited takeover bid for Banco BPM at home has also drawn Rome's involvement.
To increase its stake in the Greek group formally known as Alpha Services and Holdings, UniCredit resorted to the same mechanism it used to become Commerzbank's largest shareholder last year. UniCredit entered into financial contracts with investment banks for a stake of 9.7% in Alpha Bank, adding to its 9.6% interest, it said on Wednesday.
Its position as Alpha Bank's largest shareholder dates back to late 2023 when the banks entered into a commercial partnership for the distribution of asset management and insurance products in Greece and announced the merger of their subsidiaries in Romania. As part of the deal, UniCredit bought the holding from Greece's state-controlled bank bailout fund.
Alpha Bank shares in Athens traded over 6% higher at just under 3 euros in midday exchanges on Wednesday. They had closed at 2.79 euros on Tuesday.
"We have confidence in Alpha's leadership, their strategy, and Greece's growth trajectory," Orcel said. The group has filed a request with the European Central Bank to lift its ownership above 10% and increase it to up to 29.9%.
Alpha's stock has rallied 84% since the start of the year on the back of a strong performance, which prompted it to raise its midterm guidance to reflect the positive impact of its recent acquisitions of Cyprus's Astrobank, fintech Flexfin and investment bank Axia. Shares in peers Eurobank, Piraeus and the National Bank of Greece also traded higher.
Alpha Bank CEO Vassilios Psaltis said the bank welcomes the increase of UniCredit's stake, calling it the largest direct investment by a big European bank in the Greek banking sector over the past two decades. The move shows the potential of the partnership between the two banks, he said.
The transaction is set to close by the end of the year and will lift UniCredit's net profit by around 180 million euros ($203.9 million) a year, it said. The bank said it intends to return the additional profit to shareholders.
It expects an impact of around 40 basis points on its common equity tier 1 ratio, a measure of a bank's balance-sheet strength.
"While Mr. Orcel described the transaction as a strengthening of the strategic partnership with Alpha, we believe UniCredit's true goal is full control thus gaining a significant share of the Greek market in one move," Roemer Capital analysts Alex Kantarovich and Artem Yamschikov said in a note to clients.
Write to Adam Whittaker at adam.whittaker@wsj.com and to Elena Vardon at elena.vardon@wsj.com
(END) Dow Jones Newswires
May 28, 2025 07:00 ET (11:00 GMT)
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