ALPHA BANK: Index Impact – MSCI may add it to Emerging Market Index

Alpha Services and Holdings SA (ALPHA GA)  announced the  completion of the share capital increase by the amount of 800.000.000 euro  by placing 800mn new shares. Following the completion, the issued share capital of the company will increase from 1546mn shares to 2346mn shares. According to prospectus, new shares are expected to list on 13th July.

Index Membership: Alpha Services and Holdings is part of MSCI EM Small Cap & FTSE EM.

Potential Index Implications

MSCI: As the event is expected to increase the company full market capitalization of Alpha Services and Holdings by more than 50%, MSCI is likely to perform size segment review along with the event. The post-event full market is currently aboe the threshold required for inclusion in MSCI Greece Index (threshold is currently ±$2.5Bn) and hence MSCI may promote Alpha Bank to MSCI EM standard Index. We show passive index impact in both scenarios (1 if MSCI keep Alpha in Small Cap Index. 2) if MSCI promotes Alpha Bank to standard Index)

FTSE: Given the offering size, FTSE is likely to implement share increase on adhoc basis in FTSE Emerging Index.