ARTEMIS C. THEODORIDIS Executive General Manager of Alpha Bank

Q: Many things are happening and the new government is changing the view that foreign people and businesses have of Greece. How do you think the economy is shaping? How do you see the future and the new era of Greece today?

Mr. Artemis C. Theodoridis: This has got to be a turning point no doubt and not so much because there was a change in government, because the ideological differences at least between the two main parties are not all that important but the fact that there is a going to be a different management of the same issues by different people in the new government, plays a role and also the fact that Greece has accomplished two main targets that it had in the last few years; the entrance into the Euro zone and the successful completion of the Olympics which should not bring big changes in what the aims are for the future.

Q: The Prime Minister mentioned interesting points like how he wants local investment and foreign investment to be linked and be considered as the same thing. In a way this also affects Alpha Bank because one of the banks main targets is to boost small and medium investment. How is Alpha Bank going to play this new role of incoming foreign investments and at the same time opening its doors to the new small businesses that have been flourishing?

Mr. Artemis C. Theodoridis: First of all let me say that by definition there is no difference between Greek investment and foreign investment. All the major projects here have to be international tenders and therefore foreign investment has been for the last few years exactly the same as local investment. That does not mean though that there should be no efforts made to attract international capital but it should be the same effort as to attract Greek capital. Obviously, there are two kinds of investments. The first is direct foreign investment and the other one is portfolio investment. In terms of portfolio investments Greece has actually been quite successful and we have been increasing significantly the percentage of foreign buying in the Athens Stock Exchange during the last 12 to 18 months. This is a major factor that has been present here and we expect that to continue.
In terms of direct investment we have not done so well and there is no doubt that in that respect we need a drastic reduction of red tape in order to attract more of this type of investment. I am optimistic because the new government seems to have this reduction of red tape as a main target, but the friction that they will encounter will be considerable.

Q: You mentioned that in the last 12 to 18 months we have seen how institutional investors have focused on Greece. We know that around 28% of Alpha Banks shares are exposed to foreign markets. Do you think that this is going to increase in the future and what role can the U.S. investor play in Alpha Bank?

Mr. Artemis C. Theodoridis: I'm not sure that will increase tremendously from 28% because that's already high, but I think it will remain in that vicinity. The role of the American investor is not easily identified because it is like a puzzle. For example, an investor's money may come from the U.S., which is managed by someone in London who then gives the money to someone in Switzerland in order to buy into Greece. The fact is that Greece, and of course the share of Alpha Bank, because it is such a high free flow percentage and high liquidity, are definitely inside the focus of investors and this will continue.

Q: This links with what Alpha Bank is actually doing in the United States with its Alpha Finance Corporation. It was established in 2000 and in a way it is helping U.S. investors to see the Athens Stock Exchange as a developing market with a lots prospects for the future.

Mr. Artemis C. Theodoridis: Absolutely. That's a very small operation of course but it has a broker dealer license in the United States and it does two things. It distributes our research there and it therefore increases the awareness of the American investors for Greek companies. Secondly, it helps the Greek companies to do road shows and to present their case to the U.S. institutions.

Q: So in a way it acts as a gateway for the American investors to come to Greece. The presence of Alpha Bank in the whole region is very big, as is the bank in Albania. You have a presence in Serbia, Romania, Montenegro and Bulgaria as well as FYROM. What is the international investment plan for Alpha Bank?

Mr. Artemis C. Theodoridis: We definitely want to be a regional player. We also have a big presence in Cyprus. We are looking at investment opportunities in all of the countries in the area, for example increasing our presence in Bulgaria where and to become a regional southeastern European player. I think that we can add value at the same time we follow Greek companies in their ventures outside of Greece, although our business is not just limited to this activity. We also do business with local businessmen and with the local governments.

Q: I have a quote of where you comment on your investments in Albania, where the bank is investing in Vodafone and creating new business. Is this new line of creating international partnerships something that Alpha Bank is considering?

Mr. Artemis C. Theodoridis: This example is precisely what I have just described. We follow our Greek clients in their ventures in the other Balkan countries. That is the Vodafone example and we have done similar businesses with a lot of our clients.

Q: Alpha Bank was founded in 1879 and has been doing businesses for many years. Today it has around 450 branches worldwide, but more than that it is a well-respected institution, a name that you would link with the finance sector in Greece. Could you describe the vision of the bank and its mission?

Mr. Artemis C. Theodoridis: The bank is the number two bank in Greece and our vision is to become the number one bank in Greece in 3 years, so we want to be a major participant as we have been up until now in the economical growth of this country. As I mentioned before we also want to be a regional player in southeast Europe mainly helping Greek companies but not limiting ourselves to just this kind of business.

Q: How do you plan to become the first commercial bank in Greece?

Mr. Artemis C. Theodoridis: There is a whole business plan associated with this vision. The important thing is that we are a full service bank. Alpha Bank is a major bank in retail, in wholesale, in treasury products, in international investments and we plan to keep it that way. Since we are so big in Greece with such a big market share we cannot pick and choose. We have a growth plan in every single part of our business, but even so, I would say that the main focus for the next few years is to be strong in corporate banking, in shipping and also in medium sized company lending. We are now applying a plan for further growth in retail banking.

Q: We see Alpha Bank gaining market share in all these areas but at the same time it is going though a restructuring process and in a way becoming more efficient in every activity. How do you see this restructuring process an where is it going to end?

Mr. Artemis C. Theodoridis: The restructuring process never ends, but also in an institution that is as historic as ours and in a country like Greece that has considerable resistance to change, those changes cannot happen and must not happen overnight. Banks are large institutions and the changes have to be gradual. We will respect the tradition of the bank and therefore not lose the strength that this tradition gives us.

Q: The restructure change has been done in a very intelligent manner; opening the door for early retirement but at the same time acquiring new branches.

Mr. Artemis C. Theodoridis: Actually what you said about retirement is a classic example of the way downsizing is done in a country like Greece, at the same time we have rationalised our branch network, closing some branches and opening others. You must remember that only a few years ago we absorbed Ionian Bank and there was a lot of overlap, which we had to correct.

Q: Let's talk about the Olympics. In 2001 you won the bid for the sponsorship of the Olympics against the National Bank of Greece. Why was this an important issue for the bank? Why such a big investment on the Olympics?

Mr. Artemis C. Theodoridis: It is natural that the Olympics are much more important in this country than anywhere else in the world. That's really the bid that we made and I have to say that the fact that we got this sponsorship with such a high cost, was the sole success of Mr. Yiannis Kostopoulos, our Chairman because he was the one that had the vision that it was going to be as important and he was the one that insisted that we go after it in such an intense way. Three to four years later we are only happy that we were in that position and I would say that the two main things that this has done for us is firstly boosting the morality inside the bank and giving a common purpose to all of us in a way that we never expected would happen. Secondly, it improved the banks image in Greece and abroad. I would like to add here that we had more than 2500 people staying in hotels during the period of the Olympics from cities outside of Athens and abroad. All of these people left with an extremely good aftertaste. They all thanked us and they all thought it was a wonderful experience. This is a big asset for the bank. It was a very big bet for us because up until a few weeks before the Olympics we had incurred all the costs but we were not at all certain about the outcome. The fact that the outcome was enthusiastic has really boosted our morale.

Q: You're happy with the outcome and so is everybody else but now a big challenge would be to maybe maximise on this event. How do you think Alpha Bank can prolong in time the effects of the event?

Mr. Artemis C. Theodoridis: Well first of all the question is how can the country do it because it's not only in our hands. I really do think that the country will do it at least in terms of attracting more tourism and that includes not only the classic tourism but also more conventions and more visits to the country. One thing is that we now have the infrastructure that we definitely did not have two years ago and it seems that the new government in that respect and in terms of attracting business to Greece is very keen about it and they plan to do a big campaign for next year. We will also be starting from a very low point because Athens had disappeared from the map as a destination for years now. Barcelona experienced a slight depression after the 1992 Olympics but then it started recovering and is now doing very well. In Athens I don't think that this will happen because you cant go lower than where we were. It is however very important that the infrastructures that have to be exploited, like the stadiums for example, have to be managed by the State in an innovative manner and looking to the private sector to assign the contracts. It is the private sector that will do the best job in selling the product. Privatisation of all the venues that can be privatised is very important and it has happen quickly.

Q: 74 million euros were invested by Alpha bank in the Olympics. Do you feel that these funds will be recovered in the next 2 to 3 years?

There are two kinds of recovery. One is the actual banking business that we got but that was mostly created. A part of that is recovered directly by banking business that was related to the organisation of the Olympics. The rest of the reward is obviously not directly calculable.

Q: You mentioned the money gained or linked to the Olympics. Most of the services were incredibly profitable and expectations were increased. How do you evaluate all these new services?

Again we haven't done all the exact accounting because it is extremely difficult to calculate which of these products would have sold anyway and which are additional. We had a program called Olympic Panorama, which was a presentation of some of the Olympic sports that in the last 3 years visited over 50 locations in Greece. People became familiar with the bank and purchased products like credit cards and consumer loans.

Q: This was also done through the sponsorship of the Greek athletic team?

Mr. Artemis C. Theodoridis: Sometimes yes.

Q: Does the bank also plan to do this in the future?

Mr. Artemis C. Theodoridis: Yes it does.

Q: What role can Alpha Bank play during the next Olympics?

Well we have already been asked by the Bank of China to assist them in managing the sponsorship that they gained. As a matter of fact they visited us during the Olympics and we will send some of our people to visit them in the next couple of months because there is a number of factors in which they have asked us for technical assistance. We also did this by speaking with the Australian bank that had sponsored the Sydney Olympics.

Q: This assistance you are giving sends an important message to the market. What is your major conclusion on the investment made by Alpha Bank on the Olympics?

Mr. Artemis C. Theodoridis: On the investment made by Alpha Bank I will just relate to you a personal feeling that I had. As the Olympic Games came to a close for a moment I was thinking about how I would be feeling if those Games were happening in such a successful way and another bank was the main sponsor; the feeling I had was of utter depression. The flipside of that is that it gave us enormously high spirits and as I said the most important part was the moral boosting effect. The fact that we have a common goal and that we feel proud of the event is very important.

Q: What's next for Alpha Bank now that the Olympic Games are over?

Mr. Artemis C. Theodoridis: The target we have set for ourselves, to be the number one bank in Greece, is a very high target and we have to achieve this without compromising the quality and the image that we have had in this market for many years. This makes it even more difficult. We are known to the Greek business community as being their partners and our motto is that we work together with the client. We have to keep this image while at the same time growing aggressively. One without the other is not what we are looking for.

Q: One more personal note, you have a very busy life and schedule. How do you actually manage to incorporate such a busy life with your personal life?

Mr. Artemis C. Theodoridis: A big part of the job is like a hobby. For example the best vacations that my daughters ever had was when they stayed in Athens and attended a big part of the Olympics. The key to that is to enjoy what you are doing. If you don't enjoy it and you don't think that this is also part of your personal life then you will fail or you will end up doing something else.