Alpha Bank SP bond

Location:

Greece

Project number:

53146

Business sector:

Financial institutions

Notice type:

Private

Approval date:

27 Nov 2019

Status:

Signed

PSD disclosed:

13 Oct 2021

As permitted by paragraph 2.6 of Section III of the Access to Information Policy, disclosure of this PSD was deferred in accordance with paragraph 1.4.4 of the Directive on Access to Information.

Project Description

The EBRD invested EUR 35 million in an inaugural, benchmark EUR 500 million senior preferred ("SP") bond issued by Alpha Bank S.A., a commercial bank incorporated in Greece, in September 2021. This is the first SP instrument issued by Alpha Bank since the introduction of the EU Bank Recovery and Resolution Directive that meets the regulatory minimum requirements for own funds and eligible liabilities (MREL). The SP bonds have a maturity of 6.5 years, with a call option after 5.5 years, and are listed on the Luxembourg Stock Exchange. This follows previous investments the EBRD made in 2020 and 2021 in Alpha Bank's earlier issuances of MREL-eligible Tier 2 subordinated bonds (https://www.ebrd.com/work-with-us/projects/psd/51547.html).

Project Objectives

The Project boosts the resilience of a systemic bank in Greece in the context of ongoing restructuring and MREL requirements phasing in at EU level and supports the bank in implementing its strategic transformation plan and establishing its regular access to capital markets with unsecured instruments. Furthermore, the EBRD promotes resource efficiency in the country by requiring Alpha Bank to allocate funds in the amount of 1.5 times of EBRD's subscription to finance green investments in renewable energy and energy efficiency.

Transition Impact

The Project delivers transition impact through the Resilient quality, as the bonds issued contribute to the optimisation of the bank's funding structure by building up the MREL-eligible instrument base and diversifying liability sources. The Project also supports the Green transition quality and the EBRD's Green Economy Transition ("GET") approach in Greece through Alpha Bank allocating a multiple of the EBRD investment towards projects which meet strict GET-eligibility criteria.

Client Information

ALPHA BANK SA

Alpha Bank is one of four systemic banks in Greece with a market share by assets of c. 24% as of end-June 2021. Since April 2021, it is owned by Alpha Services and Holdings ("ASH"), which is listed on the Athens Stock Exchange. The Hellenic Financial Stability Fund is the largest shareholder of ASH with an 9% stake (as of 30 September 2021), with the remaining 91% held by more than 111,000 investors.

EBRD Finance Summary

EUR 35,000,000.00

Total Project Cost

EUR 500,000,000.00

Additionality

The Project is additional in terms of financing structure and risk mitigation, as given the anticipated large volumes of bail-in-able instruments issuance by Greek banks currently and over the next few years, EBRD's participation facilitates further mobilisation of stable, long-hold institutional investors. The project also involves standard-setting in the request to allocate EBRD participation proceeds to GET-eligible projects meeting certain demanding standards and certification requirements. This helps Alpha Bank to promote green projects and enhance awareness and deployment of funds in this area and sets a market example for sustainable finance.

Environmental and Social Summary

Categorised FI (2019 ESP). Alpha Bank is an existing client and well known to the EBRD through previous exposures. Under the existing exposures, Alpha Bank is in compliance with the EBRD's Performance Requirements 2, 4 and 9. Alpha Bank will continue to comply with these PRs, implement EBRD's applicable E&S Risk Management Procedures including the specific eligibility criteria for wind, solar, hydro, geothermal or biomass projects, as relevant; and continue to submit annual environmental and social reports to the EBRD.

Technical Cooperation and Grant Financing

None.

Company Contact Information

Ioannis Asimelis
ioannis.asimelis@alpha.gr
+302103264118
+302103268309
www.alpha.gr
40 Stadiou Str., Athens, 102-52, Greece

PSD last updated

13 Oct 2021

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.

 

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