EDITOR’S CLARIFICATION: National Bank of Greece still is listed over the counter as NBGGY. We apologize for any confusion.
The National Bank of Greece (NBGGY) is officially done trading on the New York Stock Exchange. Last Friday, the exchange announced that it had begun the process of delisting the bank, as NBG stock was deemed no longer suitable for listing based on “abnormally low” prices. NBG does have the right to appeal, however. While the stock had once changed hands at $700 per share, it hadn’t seen prices above $1 since mid-July.
So, if you were planning to pick up some NBG, I’m sorry to be the bearer of bad news. You can no longer find the National Bank of Greece’s American depository receipts (ADRs, equivalent to one ordinary share) or its Series A ADRs (equivalent to one non-cumulative preference share) listed on a major exchange.
Instead, it’s listed over the counter as NBGGY.
NBG stock plunged last Friday following the news, falling 14% throughout the day to bring its total year-to-date decline to a whopping 91%.
The stock was halted for trading at the last print of $0.161, bringing the National Bank of Greece’s total market capitalization to just $303.07 million.
As you can see above, NBG had been in a steady downtrend for quite some time, not just this year. However, the decline had sped up in recent months as a result of the bank’s recapitalization plan that involved massive dilution of the shares and a 1-for-15 stock split. The bank had recently sold new equity at a 90% discount and also announced that common shares would not be trading in Athens between November 30 and December 2. In addition, the last report on short interest in the bank was 64%.
To be honest, I struggle to put this news into perspective. I’m really not sure what a good comparison would be. After all, the collapse of Lehman Brothers was a much bigger fail with respect to raw numbers, but as for being the premier financial proxy for an entire nation, the National Bank of Greece takes the cake.
From here, I can’t be sure whether the news coming out of Greece will begin to influence our markets like it did over the summer. Once terror finally slips from the front pages, the eyes of the world will turn back to those European nations that are in trouble. Yes, you can kick the can down the road, but the can gets heavier and distance becomes shorter until eventually it doesn’t budge.
In the end, there’s no doubt that Greece will come to regret not facing itself with tougher love. Its efforts to create a soft landing after decades of profligate spending and promises must come home to roost. The effort to portray themselves as a rich and successful nation will mean waking up one day to find that the barbarians are already inside the gates.
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