Eurobank on Friday announced the acquisition of a 9.9 per cent holding (40,800,000 shares) in Hellenic Bank, according to a statement released on Friday.

It also announced entering into a share purchase agreement with Third Point Hellenic Recovery Fund L.P., for the acquisition of another 2.7 stake. As a result, post the completion of the Share Purchase Agreement, the holding of Eurobank will amount to 12.6 per cent, according to the statement.

Both banks declined to comment on the move. But sources close to Hellenic Bank said: “We thank Third Point for supporting us in the past. And it’s very positive that a financial institution of the size and strength of Eurobank is placing its trust in Hellenic Bank.”

The Third Point Hellenic Recovery Fund was set up by Daniel Loeb’s New York-based Third Point hedge fund in 2013 with the purpose of buying Greek assets.

Hellenic Bank is the second largest financial institution in Cyprus, active in personal, business and international banking. The investment is aligned with the overall strategy of Eurobank Group to further strengthen its presence in all key markets in which retains a strategic interest, the statement said.

Having a good knowledge of the local market, through its wholly-owned subsidiary Eurobank Cyprus Ltd., and taking into account the positive prospects for the Cypriot economy, Eurobank is confident that Hellenic Bank with its management, capital structure and loyal client base is well positioned to capitalise on the prospects and take advantage of future opportunities.

In this context, Eurobank looks forward to a close cooperation with the rest of the shareholders and Board of Directors of Hellenic Bank and commits to contribute constructively and positively towards that direction, the statement said.

Axia Ventures Group acted as the financial advisor to Eurobank in connection with the transaction while Milbank LLP provided legal advice.