National Bank of Greece (NBG) has secured the shareholders approval for sale of its Turkish subsidiary Finansbank to Qatar National Bank (QNB).

NBG agreed to the deal in late December, as part of a strategy to plug a funding gap revealed by European Central Bank in October stress tests.

As per the terms of the deal, QNB would acquire NBG’s entire 99.81% stake in Finansbank for EUR2.7bn ($2.94bn).

In addition, QNB also agreed to repay $910m of subordinated debt that NBG had extended to Finansbank.

The transaction, scheduled to close in the first half of 2016, will be used to pay down state aid, the Greek lender said.

NBG’s chief executive Leonidas Fragiadakis said: "After the sale NBG will be able to play a leading role in the recovery of the Greek economy, now that the country has a need for liquidity."

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By GlobalData

The bank will also reduce its emergency borrowing from the Greek central bank, which will mean savings of about 100 million euros annually, Fragiadakis added.

Finansbank operates with 647 branches and over 5.3 million customers. The bank managed $29bn in assets, $19.5bn in loans and $14.6bn in deposits as of 30 June 2015.