The benchmark at the Greek stock market declined on Monday for the fourth day in a row, a sequence unseen since early February, as global concerns over the pandemic return in response to the continued rise of global coronavirus cases. The start of some key corporate bond issues, such as those by GEK Terna and Lamda Development, has reduced liquidity in the market.
General index ended at 635.86 points, shedding 0.95% from Friday’s 641.95 points. The large-cap FTSE 25 index contracted 0.96% to 1,533.74 points. The banks index decreased 1.78%, with Piraeus tumbling 3.44%, National falling 2.33%, Eurobank giving up 1.24% and Alpha down 1.17%. Public Power Corporation sank 3.76%, Sarantis conceded 2.38%, Motor Oil dropped 2.09% and Coca-Cola HBC parted with 1.93%, while Ellaktor rebounded 2.53% and Fourlis Holdings advanced 1.90%. In total 25 stocks reported gains, 64 suffered losses and 17 remained unchanged. Turnover amounted to €43.3m, up from last Friday’s €40.2m.
First semester ends today, General index is down 30.6% ytd and -2.6% m-o-m. International sentiment improves assisting in technical bounce in today’s session. Note also that today is due day for FY:19 results announcements.
In the Spotlight
Greece/Economy: In its monetary policy report on Greek Economy BoG forecasts 5.8% GDP contraction for 2020 as its base case scenario followed by 5.6% expansion in 2021 and 3.7% GDP growth in 2022. In its optimistic scenario, BoG says 2020 GDP contraction will come in milder at 4.4% followed by a 5.8% recovery in 2021 and 3.8% in 2022. Finally, in its adverse scenario, BoG forecasts 2020 GDP contraction 9.4%, GDP growth of 5.7% in 2021 and +4.5% in 2022.
Banking Sector: Bank of Greece said that Non-performing loans continued to decline in Q1:20– this trend is, however, expected to reverse on account of the pandemic.
Based on provisional supervisory data of March 2020 NPLs came to €60.9bn, down by €7.6 billion (or 11.1%) from end-December 2019 and by €46.3 billion from their peak in March 2016. The NPL-to-total loan ratio remained high in March 2020 at 37.4%, despite falling under 40% on a solo basis for the first time in several years. The provision coverage ratio of NPLs remained broadly stable at 43.6%, which is lower than would be expected for a banking sector with considerable asset quality issues. Note however that the most part of decline is attributed to Cairo securitisation that concluded in June. Excluding Cairo transaction, the reduction in NPEs stock is estimated at €1.1bn
The outbreak of the pandemic has changed the situation. As a result, banks have revised
their securitization plans in terms of timing and loan perimeter. This will delay the further reduction of the high stock of NPLs. At the same time, despite the positive measures taken by the government and banks, an inflow of new NPLs is expected, especially from early- 2021. The volume of this new generation of NPLs will depend on the magnitude of the recession and the rise in unemployment this year, as well as on the subsequent recovery.
Τhe Bank of Greece emphasizes that there is an urgent need for solutions that would simultaneously deal not only with the high existing stock of NPLs but also with the new NPLs likely to emerge on account of the pandemic. One such solution is the setting-up of an Asset Management Company, which will operate in complementarity with the “Hercules” plan and undertake the sale of part of the NPLs, while at the same time addressing the problem of DTCs. The Bank of Greece is currently working on a scheme in this direction;
Greece/PDMA: Greece seeks to raise €625mn through the offering of 26-week Treasury-bills on Wednesday, July 1, the debt office said. The auction will be conducted via primary dealers and the government may accept non-competitive bids of up to 30% of the initially offered amount during the auction and another 30% by Thursday, July 2. Settlement will take place Friday, June 3.
Alpha Bank: Alpha Bank has reportedly extended the deadline for the non-binding bids for the sale of the over €10bn Galaxy securitization until July 3. Alpha Bank is reportedly in talks for the sale with at least five US investment firms including Cerberus and PIMCO. Alpha has launched the process early this year, but the pandemic outbreak has halted its plans. However, the bank said last month that it remains focused on achieving its NPE deleveraging plan and” is relaunching the market process of the Galaxy transaction in Q2, on the back of significant preparatory work achieved so far and continued investor interest in the project.”
TITAN: Titan Cement said it plans to raise €250mn through the issue of a new 7-year bond. Proceeds will be used to buy back in cash its 3.5% guaranteed noted due June 2021 of an outstanding principal amount of €287.8mn, general corporate purposes and pay back bank debt. The bond will be issued by its wholly-owned subsidiary Titan Global Finance.
AEGEAN AIR: AGM scheduled for July 21. The company will not distribute FY’19 dividend.
JUMBO: As of today, the company trades ex dividend gross €0.235/share (net €0.22325/share) from previous years taxed reserves.
ATHENS WATER (EYDAP): The company trades ex FY’19 gross dividend €0.38/share (net €0.361/share) as of today. DY 5.2% based on yesterday’s close €7.30.
TERNA ENERGY: On June 26, the company bought 29,566 own shares for a total consideration of €278.648K (€9.42 avg price per share).
MYTILINEOS: On June 26, the company bought 20,000 own shares at €7,4089/share and a total consideration of €148.178K. The company now controls 790,029 shares or 0.5529% of share capital.
OTE: On June 26, the company bought 54,649 shares at €12.1013/share for a total consideration of €661.325K. OTE now controls 4,254,744 own shares or 0.905% of its share capital.
PLAISIO: The company proceeded with the issuance of a new secured 6-year bond loan of €6mn from Eurobank for WC requirements.
MOTORDYMANICS: AGM clears FY’19 gross dividend distribution €0.02/share (net €0.0190/share). Ex-dividend date on July 1, payment on July 7.
BRIQ PROPERTIES: On June 26 the company bought 4,500 own shares at €1.69/share for a total consideration of €7.6K.
PETROPOULOS: AGM approves Fy’19 gross dividend distribution €0.10/share. Cut off date August 24. Payment August 28. AGM also approves share buyback of up to 10% of share capital at a price range €1-€10. Current treasury amounts to 0.081% of share capital (5,761 shares).
Other FY:19 Results:
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