EU approves a state aid to Greece's Piraeus Bank.

European Union approves an extra state aid to Greece's Piraeus Bank.

Greece's Piraeus Bank SA, the biggest lender to companies and households, won approval from the European Union for 2.72 billion euros in state aid on the basis of an amended restructuring plan.

According to the European Commission conclusions the measures already implemented as part of the bank's existing restructuring plan of July 2014, in addition to those considered in the amended plan, will enable Piraeus Bank to ensure lending to the Greek economy in line with EU state-aid rules..

After the European Central Bank's Single Supervisory Mechanism identified a capital shortfall of 4.93 billion euros for Piraeus Bank, the bank has succeeded in covering in 1.94 billion euros of the capital needs by private means. The SSM also approved additional capital actions of 271 million euros.

The experts claim that Piraeus Banks' ability to cover a substantial part of capital needs via private investments, show sign of market confidence.

The EU said that the funding will be provided by the European Stability Mechanism in the framework of Greece's adjustment program. The ESM's board of directors is expected to decide on the transfer on Tuesday.

Source: Bloomberg

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