Banks: May they be again in… 2007? – 2024-07-22 02:47:14

The foundations for the flourishing of the Greek banking system had been laid on Portuguese soil precisely 24 years in the past. In June 2000, on the EU Summit in Lisbon, Greece will get the inexperienced gentle to hitch the newly shaped Eurozone.

The adoption of a powerful forex, the prospect of low-cost cash, but in addition the extraordinarily low lending charge of the personal sector create the suitable floor for the event of the sturdy schemes of the time, the creation of latest credit score establishments and the attraction of worldwide teams.

The developments verify expectations for fast market progress. Dozens of banks, Greek and overseas pursuits, are taking a stand and claiming shares of a continuously increasing pie, which when it comes to loans from 60 billion euros in 2001 is approaching 260 billion euros in lower than 10 years.

On the finish of the 2000s a complete of 19 banks supply a full vary of providers. On this panorama the present systemic teams, Alpha Financial institution, Eurobank, Ethniki and Piraeus, management 65% of loans and 61% of deposits. The remaining is shared by 15 banks. Undoubtedly, competitors works.

The discount of competitors

The start of the tip of this construction comes with the chapter of the State in 2010. The debt haircut, which brings 30 billion euros of harm to the banking system, acts as a catalyst for its focus. International banks are pulling out, historic credit score establishments such because the Agricultural Financial institution and the Postal Financial savings Financial institution are winding down, whereas even the smaller gamers are failing.

In cooperation with the lenders, the formation of 4 pillars is set, the share of which, after they’ve absorbed virtually the complete market, exceeds 95%. The one small financial institution that continues to be within the sport is Attica Financial institution, which is nonetheless typically supported by its primary shareholders, TMEDE and EFKA, at a excessive price to their coffers. The alternatives of depositors and debtors are considerably diminished.

It took seven years of public debt restructuring to reverse the scenario. The reconnection of the nation with the markets, the advance of confidence after the political change of 2019 and the optimistic macroeconomic prospects in opposition to the successive crises (pandemic, inflation) create the suitable situations for endeavor new initiatives.

The brand new ventures

The start is made by Optima Financial institution in the summertime of 2019, arrange from scratch, after the acquisition of the Funding Financial institution of Greece, with the intention to safe the mandatory license. That is the brand new competitor of the massive system, which claims its personal position in financing.

5 years later, a brand new transfer to strengthen competitors is simply across the nook, with the creation of the fifth largest pole via the merger of Attica Financial institution and Pancreatia.

After the settlement of their shareholders, the HFSF and Thrivest of Baku, Kaimenakis, Exarchos, the way in which is opened for his or her merger, consolidation, but in addition the rise of the share capital of the consolidated scheme, to cowl the losses from dangerous loans and making certain the mandatory gasoline for the event of its operations.

The prospects

However the query stays. Can aggressive situations much like these of the 2000s be created? “It relies upon,” replies a banking supply.

As he says, “lowering the share of the 4 largest banks again to the 60% – 65% zone requires each excessive charges of credit score enlargement and the exercise of latest gamers, past Attica Financial institution – Pankritia and Optima Financial institution”.

In line with him, “the excessive curiosity margins in Greece in comparison with mature European markets can act as a magnet. Nevertheless, to ensure that a brand new financial institution to come back, both with a bodily community or digitally, it ought to be satisfied each of Greece’s improvement prospects and of minimizing the danger of a brand new fiscal derailment”.