National Bank of Greece (ADR)(NYSE:NBG) was a massive decliner during Friday’s trading session. The stock plunged by close to 14% on the back of high volumes. It is important to state that the stock has collapsed post breaking a long term support level at $0.422, which is a huge cause for concern. The bearish momentum has meant that the stock has been forming lower highs and lower lows. The relative strength index for the stock continues to trade in the oversold zone but shows no signs of an uptick. Traders believe the stock could head to levels of $0.160.
This year hasn’t added any value to National Bank of Greece (ADR)(NYSE:NBG) in terms of business expansion as well as market value. Due to worse than expected performance, New York Stock Exchange has decided to delist the ADRs National Bank of Greece.
As per the reports, the decision was taken after it witnessed 91% plunge in its market value this year.
Insights of Decision
NYSE announced the delisting of NBG’s American depository receipts on Friday after their overall value came down to just 16 cents from $1.96 in February 2015. New York Stock Exchange released a statement post this delisting procedure and called company’s position an “abnormally low.”
Things have gone bad to worse over the last few months. Earlier this month, Greek lender opted to sell these shares at 90% below their market value. This step exposed the National Bank of Greece to excessive loss, and prompted NYSE to take such a harsh decision.
At present, four largest banks of the country have been trying to raise significant capital from the market to fill a gap of $15.3 billion in their accounts. Need for this capital was first identified by European Central Bank.
Although NYSE has announced its decision, National Bank of Greece can still appeal to a committee of NYSE’s the board of directors. As soon as the announcement was made, stocks of National Bank of Greece plunged to a record low. In Athens Stock Exchange, company’s stock closed at 8 euro cents, 64% down from its price level in the previous month.
All the common stockholders of National Bank of Greece have suffered badly due to this volatility, but the position of preferred stockholders has been a little better than the common shareholders. No official statement talking about the future steps has been released by the management team as of now, but the experts hope that things might improve in the upcoming quarters.