Attica Bank is now at an important point in its transformation phase. It is planning three securitisations over the next four to five months that will take its NPE from 44% to just 1% of loans and remove about €1bn in risk-weighted assets. Its capital plan then calls for raising about €300m in equity over the next two to three years and targets a CET1 of 10% by the end of 2023 from the current 3.7% statutory ratio and an estimated -1.0% fully loaded. Attica has a market cap of €79m and although the shares do reflect the ongoing restructuring risk, we believe there is a risk of considerable shareholder dilution. However, if the securitisations and capital raisings are successful, Attica will likely have a healthy balance sheet that would allow it to pursue its strategy of doubling the loan book in three years by focusing on the energy, green and infrastructure business loan segments. We are suspending our forecasts and valuation until there is greater clarity on the outcomes of these capital actions.
