National Bank of Greece has made an offer for Eurobank Ergasias in an attempt to hold on to the lion share of the Greek market at a time when corporate merger and acquisition activity is expected to pick up in the financial sector.

Shares of both banks have resumed trading after being suspended when rumours of an imminent merger first surfaced on Friday.

Bloomberg reports that National Bank of Greece has offered 58 shares for every 100 shares of Eurobank.

The new group would be called NBG Group and would have a total of €178bn in assets, €110bn in loans, and €87.9bn in deposits.

"This mega-merger changes radically the landscape of the domestic banking sector, with the new entity becoming by far the largest domestic financial institution," Euroxx Securities SA analyst Maria Kanellopoulou said in an e-mailed note.

"Nevertheless, we highlight the high expected integration costs, as well as the implementation risk, as the two lenders have different corporate cultures."

SC

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