Commission approves aid for the resolution of Greek Panellinia Bank

European Commission: Panellinia resolution aid was in line with state aid rules

The European Commission has found that resolution aid granted for the resolution of a small retail bank Panellinia Bank (with a 0.3% market share in Greece) is in line with EU State aid rules. The Bank of Greece has decided to put the bank under resolution because Panellinia Bank did not successfully cover a capital shortfall identified in the 2013 stress test of the Greek banking sector. Under the resolution plan selected activities of Panellinia Bank will be transferred and integrated into Piraeus Bank, which follows an open and non-discriminatory sales process. This will ensure that Panellinia Bank’s transferred activities return to long-term viability within the new entity, while limiting the distortion of competition created by the State aid granted. Existing shareholders contributed fully, reducing the need for State aid to the necessary minimum in line with burden sharing principles. Finally, the European Commission has found the transfer of the selected activities in line with the restructuring plan of the Piraeus Bank approved on July 23, 2014.