News flow in the past few days has been fast and furious. I’ll recap the highlights as best as possible:
1) Greenlight RE, run by David Einhorn, lists Alpha Bank as one it’s largest positions: As of 28-February-2014, the largest disclosed long positions in our investment portfolio are Alpha Bank A.E., Apple, gold, Marvell Technology, Micron Technology and Oil States International; our investment portfolio is approximately 118% long and 71% short.
http://www.greenlightre.ky/FinancialInformation/InvestmentReturns.aspx
2) Chatter of Piraeus Bank as well as Alpha returning to debt markets:
3) Alpha Bank released it’s earnings as well as a plan to raise 1.2B euros primarily to repurchase HFSF preference shares. While the headline reads dilution, the investment presentation seems to justify the action and may mitigate some of the dilution. The pref’s have a step up feature the longer they are outstanding as well as a conversion feature. Additionally it removes the dividend restriction for the future.
Click to access 2013_Q4_Financial_Report.pdf
4) TBV is stated as 0.68 euros per share, which is about in-line with last quarter.
5) In Q4 2013, our stock of NPLs decreased for the first time since the economic downturn in Greece, mainly due to increased remedial measures. As a result, our NPL ratio declined by 20bps in Q4 to 32.7%.
Click to access Deltio_Typou_20140310EN.pdf
6) For some general thoughts on investing in Greece, there is a nice repository of presentations, notable investors are Marathon, York, and FIG:
http://forums.capitallink.com/greece/2013/
All in all it seems like some positive developments in the cap structure are coming. It is also encouraging to see the first decrease in NPL since the crisis as I believe this will likely be a driver of fundamentals. Unfortunately it seems the equity will be diluted but the amount is still uncertain and this is likely a LT positive as it removes the HFSF overhang. I will be interested to see if Greenlight or other international investors are involved in the offering.
Value Cap Trader 