Piraeus bank buys Greek units of three Cypriot banks

Greece's third biggest lender, Piraeus Bank, said on Tuesday that it had signed an agreement to acquire all of the Greek deposits, loans and branches owned by the subsidiaries of three Cypriot banks.

A Piraeus statement said that the Greek units of the Bank of Cyprus, the Cyprus Popular Bank (CPB or Laiki) and the Hellenic Bank were acquired for 524 million euros ($675 million) in cash.

According to the statement, the Cypriot bank branches which have remained closed for more than a week are set to open on Wednesday.

"All the operations will be run in the normal course of business," the statement added.

"Customer deposits with the Greek branches of Bank of Cyprus, Cyprus Popular Bank (CPB) and Hellenic Bank are not subject to any bank levy or haircut that has been agreed in Cyprus," the statement emphasised.

According to the Greek press, Piraeus is now set to become the country's second biggest bank.

Piraeus said that after the completion of the transaction, the Piraeus Bank Group will have consolidated total assets of 95 billion euros, 1,660 branches and 24.000 employees.

The announcement came amid turmoil on the Athens stock exchange, where the Athex index had plunged 4.78 percent, with a sub-index of banks receding by 3.15 percent.

Greece's top three lenders as well as the state-owned postal bank had expressed interest in buying the Cypriot bank branches, and on Friday, the national Hellenic Financial Stability Fund said that the Piraeus Bank bid had been approved.