Greetings! So, the pollsters are showing Androulakis ahead in PASOK. We’ve discussed this before, but that doesn’t mean that Doukas has thrown in the towel—on the contrary, I’d say. As for “Harry for president,” I see he’s getting support from the pure Papandreou bloc, including Nikos Pap., who openly backed the mayor in Kathimerini.gr yesterday, as well as from GAP’s office, which is also calling in support of him. Another MEP, Maniatis, has sided with Nikolas the man of his word, while the third MEP, Arnaoutoglou—the meteorologist—is leaning towards the Doukas.

SYRIZA

Now, over in SYRIZA, the player pulling the strings isn’t Nikos Pappas anymore; it’s Pavlos Polakis, the institutional one. P.P. has left behind the extremes and the late-night Facebook rants where he used to curse “like a truck driver” as they used to say, and has reinvented himself as the party’s elder statesman. He’s now shielding Kasselakis from being ousted as a candidate, a move being worked on by the “87,” and is saying, “Guys, let’s play fair, 50-50.” Sort of like young Gagatsis, if you know what I mean.

“Premiere” for Safe Youth

Leaving behind these juicy tidbits, let’s move on to some flat-out governmental stuff. The government has shifted its rhetoric from “the battle of everyday life” to “improving citizens’ lives” because, as we all know, no one has ever won the battle of “everyday life”. One of the initiatives that will be making its debut in the next few days—at the latest by the end of next week—is the Safe Youth app. This app has been developed by the Ministry of Citizen Protection in collaboration with the Ministry of Digital Governance, allowing minors aged 12-18 to report incidents of violence and abuse.

The final proposal for cameras

Another issue citizens are awaiting for is the installation of cameras on the streets of Attica. As my source clarified yesterday, there are two types of cameras: the 1,000 that will be installed to monitor traffic, but these won’t be connected to automatic fine-issuing systems. These are the responsibility of the Region and are being gradually rolled out, but the matter is more complex due to personal data concerns. However, next week, the final proposal for the 1,000 cameras will be presented to KM, so the project can move forward, with installation expected to begin by early 2025 at the latest.

He dodged it…

Meanwhile, KM is still struggling a bit with his back, though less than before. He even mentioned it to a kid he met yesterday at the Children’s Hospital, who had a bandaged leg and will be back to playing soccer in December. “We’re in recovery,” the Prime Minister told the boy, referring to his ongoing back issue, which has been bothering him for several weeks now. At least he dodged the back-to-back trips after his appearance at the Mediterranean Summit in Paphos today, as the Friends of Ukraine meeting at NATO’s Ramstein base in Germany on Saturday was canceled due to Hurricane Milton.

Stournaras awaits the banks’ proposals

Stournaras is waiting for the banks’ proposals on how they plan to write off their deferred tax credits (DTCs) faster than the current deadline of 2041. Relevant meetings have taken place at the Bank of Greece, with pressure being applied for the adoption of policies that would expedite the write-offs, aiming for a horizon of ten years from now. If this happens, there will be greater supervisory leniency regarding higher dividends. As of last June, the definitive deferred tax claims of systemic banks stood at €12.5 billion, representing 50.5% of Common Equity Tier 1 capital. Stournaras’ initiative aims to eliminate this unfavorable factor affecting the quality of banks’ capital while supporting the banks’ goal of distributing larger dividends.

The Karnesis-Empeirikos feud, the “Greek Maldives,” and…ENFIA

It seems that the ENFIA debt owed by “Ktimata Petalioi”—the company managing the famed island complex in the Euboean Gulf, also known as the “Greek Maldives”—is finally heading toward resolution. As previously mentioned, the company, controlled by the family of shipowner Spyros Karnesis, owes the state €1,109,532.70 for ENFIA from 2014 to 2018. According to the 2023 financial statements, “the interest on these liabilities as of 12/31/2023 amounts to €701,231.10, of which €515,161.63 pertains to interest up to 12/31/2022 and has already been accounted for in previous financial years. Additionally, €186,069.47 relates to 2023 interest.” The interest rate is 0.78% per month, and the company has set aside a provision for ENFIA from 2019-2022, amounting to €1,149,360.10. Despite negligible revenues (€21,804.24 in both 2023 and 2022), the ENFIA burden has led to a reduction in the company’s equity. As of 12/31/2023, the company’s equity (€465,642.51) has decreased to less than half of its share capital. As required, the board convened a general meeting to discuss either dissolving the company or adopting other measures. They chose the latter, but here begins a new saga. A June 26, 2023 decision scheduled an extraordinary general meeting for July 21, 2023, proposing a share capital increase of €1,600,039. However, the meeting was temporarily suspended by a July 20, 2023 order of the Athens Single-Member Court of First Instance, which was later revoked by a November 16, 2023 order of the same court. A rescheduled general meeting for November 19, 2023, was also suspended by a November 18, 2023 order until the next hearing on March 1, 2024. This appears to be another episode in the long-running feud with fellow shareholder M. Empeirikos. However, on March 4, 2024, a company shareholder (presumably from the Karnesis side) paid €800,019.50 for a share capital increase, which the company used to settle its outstanding ENFIA debts in installments. Moreover, there has been a reshuffling of the “Ktimata Petalioi” board. On September 9, 2023, Nikolas Karnesis took over as chairman, replacing his sister Angelique, who remains a member along with their father Spyros Karnesis. Notably absent is his wife, Vasiliki Gkila.

The Kalamata airport’s moment

Finally, the much-anticipated moment has arrived at the Hellenic Republic Asset Development Fund (HRADF), as they await binding offers from investors in the Kalamata airport concession (for 40 years). In the final phase of the tender are GEK TERNA – GMR Airports, Fraport AG with DELTA Airport Investments (Kopelouzos Group) – Pileas (Kostantakopoulos TEMES Group), Mytilineos with Corporation America Airports, and the French Egis Airport Operation with Aktor Concessions and Aéroports de la Côte d’Azur. The renovation plans focus on upgrading and expanding the passenger terminal and aircraft parking areas. If everything goes according to plan, a preferred bidder will be selected by December.

Next up are the Poles for TERNA Energy

Following the green light from the European Commission for Masdar’s acquisition of exclusive control of TERNA Energy, another regulatory approval remains to complete the biggest “green” deal in Greece, worth €3.2 billion. Approval is required from Polish authorities due to TERNA Energy’s presence in the country, a formality but essential. On October 23, 2024, the general meeting is scheduled for shareholders to approve the sale of TERNA Energy shares to Masdar. The first phase of the transaction will follow shortly after, with a public offer for the remaining shares expected by the end of 2024 or early 2025. Initially, Masdar will acquire 67% of TERNA Energy’s shares at €20 per share, followed by a mandatory public offer for the remaining 33%.

The unveiling of the (former) Intrakat

On Wednesday, October 23, the current Intrakat management will invite the press to reveal the company’s new name and corporate structure. The “new Intrakat” will be less reliant on construction and more focused on concessions, PPP projects, and renewable energy. CEO Alexandros Exarchou has told analysts that the strategy now centers on generating diversified EBITDA sources. While the construction sector will continue to contribute significantly (with a backlog of over €5 billion), the company will aggressively pursue new PPP contracts and investment opportunities in the renewable energy market.

Google makes a case study of protothema.gr

To blow our own horn, for the fifth time in the past four years, Google has made protothema.gr a case study for its pioneering implementation and positive results, which increased both visits and time spent on the gaming section of the site. Protothema.gr is the only Greek site featured as a Google case study. The collaboration resulted in 10,000 daily users playing games on the site and spending an average of 30 minutes on it.

The Approval of Attica Bank

A sudden rise of over +29.11% was seen yesterday in Attica Bank’s stock, reaching €2.04 with 117,000 shares traded, as it seems that today or at the latest by Monday, the Hellenic Capital Market Commission will approve the Information Bulletin and the procedures for the significant composite share capital increase of €735 million, along with the issuance of warrants and the reverse split of the shares.

Alumil is Coming to Athens

Next Monday, the management of Alumil will come to Athens, and at a central hotel, they will announce their grand plans following their liberation from past debts and servicers. George Mylonas is coming from Thessaloniki to explain how the separation of the foundry from the parent company is progressing and to update on the re-establishment of Alufond. The important thing for the Alumil Group is the definitive settlement of old debts and their relief from the pressures of the servicers. Alumil, with a turnover of €460 million, is burdened with loans amounting to €135 million. The company is steadily increasing its operating profitability, and its market capitalization stands at €95.6 million.

Stress Test: The Stock Market

There are many placements but few codes. So far, the Hellenic Capital Market has “lifted” the burden of raising €3 billion through stock sales, capital increases, and public offerings. Next in line are Attica Bank, Elval, HelleniQ Energy, EpAtt, and Trade Estates, which wants to reduce Fourlis’s stake below 50%. All of this is happening without the influx of new investment capital, neither from abroad nor domestically. The recycling of capital in the Greek stock market seems to have exhausted its limits and requires the attraction of fresh money. It has become clear that for investors to participate in new security issues, they are selling off the “heavyweights” and profitable stocks that have high liquidity. For example, yesterday, in the 4th consecutive declining session of the General Index, which closed at 1,411.61 (-0.54%), out of the 23.2 million shares that changed hands, 17.4 million were from the banking sector. In the last 10 trading sessions, 9 were negative for both the General Index (which lost -4.05%) and the Banking Index (which lost 6.68% of its value).

Hurricanes and “Catastrophe Bonds”

“Catastrophe Bonds” (“cat bonds”, which have nothing to do with cats) are particularly popular among institutional investors seeking higher returns that are not influenced by economic conditions (interest rates, recessions, etc.) but by specific events of major disasters. Catastrophe bonds are issued by insurance and reinsurance companies to transfer the risk they undertake to the capital markets. Investors who take on the risk enjoy high returns in years when there are no catastrophic natural events. It’s impressive: Over the last 20 years, the Cat Bond Index has achieved an average annual return of 7.3%. The operation of this market is simple: The insurance or reinsurance company creates a special purpose vehicle (SPV) to issue the bonds. The bonds are sold to institutional investors who seek high returns in exchange for taking on the risk of a major natural disaster. Obviously, the coupons of Cat Bonds are higher than those of traditional bonds. To activate the Cat Bonds, a trigger event is defined, such as a hurricane reaching a certain size or a specific dollar amount in damages from a natural disaster. If the specified disaster does not occur within the bond’s timeframe, the investors are repaid their initial capital along with interest payments. However, if a catastrophic event occurs and the damages (claims) exceed the predefined limits, the insurer may use the invested capital to cover its losses, which means that investors could lose part or all of their investment.

The Mixed Signals of the American Economy

In America, the inflation rate in September was 2.4%, better than in August but worse than expectations and estimates. The problem for the FED is even more complex: Core inflation has climbed to 3.3%, marking its first increase since March 2023. American central bankers are particularly attentive to employment numbers. Just this week, 258,000 people filed for unemployment benefits, a figure that is 28,000 higher than analysts’ expectations. Jerome Powell, on September 18, dramatically reduced dollar interest rates by half a percentage point, but core inflation and the rise in unemployment are sending alarming signals. That’s why the market’s reaction has been peculiar. Stock markets reacted sluggishly to the new data, bond prices fell, and gold found the opportunity for a new upward leap. All of this is happening in a particularly tense political environment, just before the elections on November 5, where even Hurricane Milton became a subject of partisan dispute. Not to mention the impending decision of the FED regarding interest rates.