Alpha Services and Holdings S.A., the parent organization of Alpha Bank S.A., has revealed a binding agreement to acquire the banking operations, assets, liabilities of AstroBank Public Company Ltd.

The transaction is valued at a minimum of €205 million and will be carried out through Alpha Bank Cyprus Ltd, a subsidiary of Alpha Holdings.

This acquisition is in line with Alpha Bank Group’s strategic objective to enhance its presence and financial influence in key target markets. Once the deal is finalized, Alpha Bank Cyprus is projected to capture about 10% of the market share. Coupled with an ongoing transformation program, this is expected to establish it as a contemporary banking alternative for households, small and medium enterprises, and large corporations in Cyprus.

Specifically, Alpha Bank Cyprus anticipates an increase in its loan portfolio by over 60%, deposits by roughly 70%, and total assets by around 65%. Considering the synergies from this acquisition, the bank’s recurring net profit is expected to surpass €100 million annually, effectively doubling its profitability. The transaction is anticipated to have a limited impact on the Group’s Common Equity Tier 1 (CET1) ratio, with an estimated effect of around 40 basis points. Under the terms of the deal, certain Non-Performing Exposures (NPEs) of AstroBank will be excluded, ensuring a neutral impact on the Group’s NPE ratio.

Furthermore, the deal is expected to boost Earnings Per Share (EPS) by 5% a 60-basis-point improvement in Return on Tangible Equity (RoTE), and a 40 per cent return on regulatory capital, considering the expected synergies.