Italy´s UniCredit and Greek shipping lender Alpha have agreed on the key economic terms for the merger of their subsidiaries in Romania.

UniCredit said on Monday that it plans merger in Romania and strategic partnership in Greece with Alpha Bank, one of the biggest Greek lenders to shipping, as the data from the Petrofin Research survey for the year 2022 shows Alpha Bank ranking in the top banks that finance Greek shipping with 6.81% (3.535 billion).

Specifically, UniCredit and Alpha Services and Holdings S.A, a 100% parent of Alpha Bank have signed a binding term-sheet for the creation of a strategic partnership in Romania and Greece.

The deal will create the third largest bank in the local market with a combined 12% market share by total assets.

The merger combines two complementary franchises in a high growth country, with UniCredit Romania and Alpha Bank Romania having strong footholds in the corporate and retail segments.

Transaction closing is expected in 2024, “subject to the completion of a due diligence process, corporate approvals for the merger and all necessary regulatory approvals and consents, including on anti-trust,” reads the announcement.

Alpha Bank is expected to retain 9.9% of the combined entity share capital and receive a cash consideration of €300 million. “The cash component remains subject to post due diligence adjustments related to asset quality, if applicable,” the same source said.

For Alpha Bank, the overall transaction leaves net profit expectations unchanged, and further enhancing its capital buffers, as UniCredit noted today.

The merger will see UniCredit strengthening its presence in Romania, whilst it will expand its “product and platform reach to Greece,” a country with strong growth prospects.

“Greece, following structural reform in recent years, has returned to being a high growth country with strong potential,” said UniCredit.

Meanwhile, the data from the Petrofin Research survey for the year 2022 shows the top banks that finance Greek shipping.

Credit Suisse which owns 10.6% ($5.5 billion) of the Greek shipping portfolio.

Alpha Bank with 6.81% (3.535 billion)

Eurobank with 6.65% (3.450 billion)

Citi also with 6.65% (3.450 billion)

Piraeus with 6.33% (3.2 billion)

National Bank with 2.7 billion has a percentage of 5.37%.