Expect M&A activity in a Greek market buffeted by
declining new business, reports Fred
Crawley
The Greek lease market saw new lending fall by 10.6 percent over
2008. Of the country’s 15 lessors, all owned by banks, the greatest
cuts were seen by the 2nd, 3rd and 4th largest (Cyprus, Piraeus and
Alpha Leasing), which between them were responsible for cuts
equivalent to 92 percent of total decline in new business.
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Market leader EFG Leasing saw a
relatively mild 6 percent drop, while significant gains were seen
by the country’s “second rank”: Emporiki Leasing (part owned by
Crédit Agricole), Greek Agricultural Bank subsidiary ATE Leasing,
and the leasing arm of Attica Bank, which upped volumes by 46
percent.
With Greece’s GDP expected to rise by
less than one percent in 2009, challenges alongside general
liquidity constraint include a drop in construction and
manufacturing business, inflexible public sector expenditure and
the rising cost of funding through mid-to-long-term loans.
On the other hand, despite the
industry’s reliance on real estate, sale and leaseback of corporate
premises has provided a lifeline for many. Also, because of the
long-term nature of these leases, the pace of Greece’s overall
portfolio decrease is lower than other countries experiencing
similar levels of new-business shrinkage.
Sources within the market strongly
suggest banking sector mergers will bring at least two leasing
companies together during 2009, with the National Bank still
thought to be sniffing out acquisition targets after speculation
about a possible deal with Piraeus last year.
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By GlobalDataAt a glance: Greek leasing
market by asset type, sector and region
|
Division criteria |
Total business written in 2008 |
Proportion of overall business |
Total business written in 2007 |
Proportion of overall business |
|
By asset type |
||||
|
Real estate |
1,363 |
53.15 |
1,656 |
57.65 |
|
Machinery & equipment |
485 |
18.90 |
453 |
17.45 |
|
Office equipment |
119 |
4.65 |
108 |
3.40 |
|
Trucks & buses |
275 |
10.73 |
308 |
9.06 |
|
Vehicles |
167 |
6.52 |
219 |
9.01 |
|
Other |
155 |
6.05 |
126 |
3.42 |
|
Total |
2,565 |
2,869 |
||
|
By lessee sector |
||||
|
Manufacturing |
334 |
13 |
396 |
19 |
|
Commerce |
844 |
33 |
645 |
26 |
|
Services |
892 |
35 |
1,067 |
32 |
|
Other activities |
495 |
19 |
760 |
23 |
|
Total |
2,565 |
2,869 |
||
|
By region |
||||
|
Attica Area |
1,740 |
67.83 |
2,043 |
64.77 |
|
Northern Greece |
299 |
11.65 |
346 |
14.42 |
|
Central Greece |
172 |
6.70 |
149 |
6.28 |
|
Other Areas |
355 |
13.82 |
331 |
14.52 |
|
Total |
2,565 |
2,869 |
||
|
Source: Leasing Life |
||||
The top 10: Greek leasing
companies ranked by finance lease business volume
|
Rank |
Company |
Ownership |
Foundation |
New business 2008 (€m) |
New business 2007 (€m) |
Y-o-y change (%) |
Portfolio on 31.12.08 |
Portfolio on 31.12.07 |
Y-o-y change (%) |
|
1 |
EFG Leasing |
EFG Eurobank 100% |
1999 |
508 |
539 |
-5.8 |
1,629 |
1,535 |
6.1 |
|
2 |
Cyprus Leasing |
Bank of Cyprus 100% |
1997 |
415 |
504 |
-17.7 |
1,372 |
1,360 |
0.9 |
|
3 |
Piraeus Leasing |
Piraeus Bank 100% |
1993 |
389 |
478 |
-18.6 |
1,288 |
1,237 |
4.1 |
|
4 |
Alpha Leasing |
Alpha Bank 100% |
1987 |
305 |
406 |
-24.9 |
1,291 |
1,194 |
8.1 |
|
5 |
Ethniki Leasing |
National Bank of Greece 100% |
1990 |
222 |
229 |
-3.1 |
810 |
704 |
15.1 |
|
6 |
Emporiki |
Emporiki Bank 80%, Crédit Agricole Leasing |
1989 |
200 |
171 |
17.0 |
596 |
495 |
20.4 |
|
7 |
ATE Leasing |
Agriculture Bank of Greece 100% |
1991 |
136 |
105 |
29.5 |
420 |
341 |
23.2 |
|
8 |
Attica Leasing |
Attica Bank 100% |
2001 |
111 |
76 |
46.1 |
208 |
150 |
38.7 |
|
9 |
Marfin Leasing |
Marfin Bank 100%, |
2007 |
95 |
109 |
-12.8 |
350 |
370 |
-5.4 |
|
10 |
Probank Leasing |
Probank 100% |
2001 |
64 |
49 |
30.6 |
182 |
165 |
10.3 |
|
Note: Greek Leasing companies ranked by |
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