UPDATE 2-Fairfax-led group to invest in Eurobank in bet on Greek turnaround

Tue Apr 15, 2014 1:41pm EDT
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* Fairfax, others bid for 47 pct of Eurobank share issue

* Group offers 0.30 euros a share, a 25 pct discount

* Move shows Greece back on investor radar screens (Recasts with bailout fund picking Fairfax)

By George Georgiopoulos

ATHENS, April 15 (Reuters) - International investors are to invest 1.3 billion euros ($1.8 billion) in Eurobank to become the bailed-out Greek bank's biggest shareholders in another sign of growing market confidence in Greece.

The country's bank bailout fund HFSF has picked an investment group led by Canada's Fairfax as anchor investors in a share sale needed to plug Eurobank's 2.86 billion euro capital shortfall.

Eurobank, Greece's third-largest bank and 95-percent-owned by the HFSF, is issuing new shares to help to plug the gap revealed last month in a central bank stress test.

The investors' cash will reduce the strain on the Greek government's resources. The less the HFSF spends to replenish Greek banks' capital, the lighter and more manageable the country's debt load becomes.

If Eurobank raises the full 2.86 billion euros from markets this means the HFSF, endowed with 50 billion euros by the European Union under Greece's international bailout, will not have to dip into its remaining 11 billion euro capital buffer.   Continued...