Regulators are still combing the books before giving final approval.

It has been nearly a year since Greece’s Attica Bank initiated a merger with Cyprus-based investment firm Thrivest. Negotiations have been in perpetual motion since Attica set out in search of investors to recapitalize the bank late in 2022. However, an end to Thrivest’s pursuit of approval for the deal is nowhere on the horizon.

Thrivest, a considerable shareholder in HSBC and Pancreta Bank, has been creating ripples throughout the Greek banking sector despite its seeming lack of substantial capital.

Recently, it unfurled plans for a new “super bank,” a move carrying the potential to shake both the regional and global economy. In April, Attica divulged that the Hellenic Financial Stability Fund (HFSF), Thrivest, and Pancreta were committed to participating in a share capital increase plan by Attica, a move set to infuse up to €393 million as part of a merger deal.

However, as of today, the mystery surrounding the consolidation of the Attica-Thrivest bond persists.

Top-tier sources from Greece confirm Thrivest’s interest in the deal remains unapproved, and significant concerns remain.

There’s a suggestion that stringent scrutiny is underway due to one of Thrivest’s shareholders’ association with oil trading in the United Arab Emirates.

The relatively small Arab country has been under scrutiny as a major laundering route for Russian and Venezuelan funds, enabling Caracas and Moscow an avenue to evade Western sanctions by exporting discounted crude oil to the UAE.

However, no evidence suggests Thrivest’s direct involvement in the scheme.

Separately, allegations surround Alexandros Exarchou, one of Thrivest’s trio of owners, claiming he falsified public filings in the UK, a potential legal breach.

Greece’s central bank, along with the European Central Bank, remains actively involved in the process of evaluating approval. Both central banks are purportedly collaborating to assess Thrivest’s reputation and financial solidity.

During the process, it came to light that when Attica originally sought investors, U.S.-based firm Ellington was coordinating with Thea Artemis, an independent servicer of non-performing loans provided by Greek banks and financial institutions.

A senior Greek banking source confirmed ongoing anti-money laundering checks are in place to validate the origin of any funds Thrivest has invested in the bank.

At present, no final verdict exists on Thrivest’s acquisition of a qualifying hold in Pancreta as Greece’s central bank and the European Central Bank continue their investigations. Senior Greek bankers acknowledge that Pancreta’s potential merger with HSBC, and possibly Attica, would give birth to a significant market competitor, challenging the reigning institutions.

The Greek banking system, amongst the most concentrated in Europe, sees the four largest banks clutching a market share of 95%. Numerous smaller players bowed out of the marketplace, and many foreign banks exited the country in the wake of the sovereign debt crisis that followed the 2008 global financial meltdown.

For now, with apprehensions still roiling the banking sector, regulators appear to be meticulously deliberating the go-ahead for Greece’s super bank.