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Maintaining the stability of the Greek banking system and attracting new private capital into banks are the immediate tasks of the Financial Stability Fund, said Anastasia Sakellariou, Executive Director of the Fund, in a statement accompanying its annual report for 2012.

The main points in the report are the following:

The capital of the Fund and capital strengthening of good banks: following the capital increase of the Fund in 2012 and 2013 with floating rate notes issued by the European Financial Stability Fund, the Fund’s capital amounts to 49.7 billion euro. Following the signing of pre-registration agreements and according to the letter of the Bank of Greece regarding the necessary capital strengthening, on 28 May 2012 the Financial Stability Fund started paying bonds of the European Financial Stability Fund with a nominal value of 18 billion euro as an advance payment against future capital increases of the four good banks. In particular, Alpha Bank will get 1.9 billion euro, Eurobank - 3, 97 billion euro, Piraeus Bank - 4.7 billion euro, and the National Bank of Greece - 7.43 billion euro. At the end of 2012, the four banks received from the Fund 6.262 billion euro capital strengthening.

Payment of Funding Gaps: According to existing laws, for the period of 22 months, starting as of 22 February 2012, the Fund is obliged to cover sums of money that will be the result of the reorganisation of credit institutions, while at the same time it has to intervene temporarily in the competence of the Deposit Insurance Fund. Within this framework, in 2012 the Financial Stability Fund deposited 7.256 billion euro for the reorganisation of five credit institutions. On 31 December 2012, the Fund reported that the recoverable amount of the process of liquidation will be 2.218 billion euro, which is about a 5.038 billion euro decline in its expectations. It is noted that the Fund has no responsibility or control over the process of liquidation, the competence belongs to the liquidator and the supervisory authority, the Bank of Greece.

Cash availability and equivalent: On 31 December 2012, the cash availability and equivalent amounted to 828 million euro.

Functional expenses: in 2012, these amounted to 4.9 million euro, including management costs, fees of consultants, lawyers and staff.

Acquisitions of banks in 2012 and 2013:

- Alpha Bank acquired Emporiki Bank;

- The National Bank acquired the healthy parts of FBB and Probank;

- Piraeus Bank acquired the healthy parts of the Agricultural Bank Agrotiki, Geniki Bank, Millennium Bank and the Greek networks of the Bank of Cyprus, Cyprus Popular Bank (Laiki Bank), and the Bank of Greece;

- Eurobank acquired the new TT Hellenic Postbank and the new Proton.

In the case of the New TT Hellenic Postbank, the Fund, as the sole shareholder, submitted share capital amounting to 500 million euro and covered a funding gap in the amount of 3.96 million euro, instead of the Deposit Insurance Fund, following a decision by the Bank of Greece. In the case of the New Proton Bank, in 2012 the Fund, as the sole shareholder covered the whole capital strengthening of the bank with 295 million euro, so that the bank could meet the capital requirements set by the Bank of Greece.

Business Management: The Executive Committee has three members and is responsible for the preliminary preparation and execution of decisions of the Management Board. The Management Board has 5 members (two independent members will be added to the Board) and is responsible for the supervision of the fulfilment of the Fund’s obligations, as well as for the control over the management of its operations. The Supervisory Committee assists the Board in the performance of its supervisory duties over the process of financial information, effectiveness of internal control, appointment of external auditors, their independence and fees, as well as activities for monitoring compliance with laws, statutes and codes of ethics.

Activities of the Fund in 2012 resulted in the successful recapitalisation of good banks in 2013: following the capital increase of the four good banks in 2013, the Fund’s share in their share capital is as follows: the National Bank of Greece - 84.35%, Piraeus Bank - 81.01%, Alpha Bank - 83.71% and Eurobank - 93.55%.

Priorities for 2013

a) Plans for the restructuring of good banks

According to the rules for state-building, banks that receive capital consolidation are obliged to proceed with the restructuring based on a 5-year plan, which is approved by the European Commission (Directorate-General for Competition).

b) Privatisation of Eurobank

Following the signing of the contract for the purchase of the TT Hellenic Postbank and the New Proton Bank, Eurobank’s group strengthened its strategic position in the Greek banking system and its attractiveness to investors, in this way facilitating its future privatisation in favour of the state and the Greek society. Over the coming months, the Financial Stability Fund will pave the way for the return of Eurobank in the private sector, taking care for the effective functioning of the bank and its preparation for effective privatisation.

Meanwhile, on Friday afternoon, Eurobank informed about the establishment of a new Executive Board and the restructuring of the Strategic Planning Group (SPG).

In particular, the Strategic Planning Group, as well as the Executive Board, will be renamed and transformed in order to improve their contribution to the strategy and performance of the bank, as noted in the statement regarding this issue.

The Strategic Planning Group will be renamed to Executive Board and will consist of:

Chairman: Christos Megalou, Chief Executive Officer

Members:

Michael Kolakides, Deputy Chief Executive Officer, Chief Risk Officer

Konstantinos Vousvounis, General Manager of banking operations and investments

Stavros Ioannou*, General Manager Retail Banking

Fokion Karavias, General Manager Capital Markets & Wealth Management

The Management Committee will be transformed and consist of the following members:

Chairman: Christos Megalou, Chief Executive Officer

Members:

Michael Kolakides, Deputy Chief Executive Officer Risk Management (Chief Risk Officer)

Konstantinos Vousvounis, General Manager of banking operations and investments

Stavros Ioannou*, General Manager Retail Banking

Fokion Karavias, General Manager Capital Markets & Wealth Management

Despina Andreadou, General Manager internal control of the group (non-voting)

Dimos Archodidis, General Manager Private Banking

Kostas Vassiliou, General Manager Global Corporate Clients & Debt Capital Markets

Ivi Viga, General Manager Loans

Michael Vlastarakis, General Manager Branch Network

Athina Dessypri, General Manager Human Resources

Evangelos Kavvalos, General Manager small businesses

Petros Katsoulas, General Manager of the Group's strategy

Harris Kokologiannis, General Manager Group Finance & Control (Chief Financial Officer)

George Marinos, General Manager Corporate Banking Group

* Stavros Ioannou will perform the duties of the Head of the General Directorate of Labour, technology and organisation of the group.