Hellenic Financial Stability Fund

The government is moving quickly to develop plans to reduce the retail banks' nonperforming loans, hoping it will make up for the wasted time under the SYRIZA government.

Piraeus Bank has agreed to sell half a billion euros of non-performing corporate loans to an entity affiliated with Davidson Kempner Capital Management as part of efforts to clean up its balance sheet.
Greece's largest lender by assets on Monday said it is selling loans with a gross book value of 507 million euros ($573 million) and has agreed a price of 240 million euros.

Prominent Greek banker Giorgos Michelis, who was appointed as Chairman of the Board of Attica Bank in late March, died on Saturday at the age of 69.

Michelis had many years of banking experience having served as CEO of Bancpost, a subsidiary of Greece's Eurobank in Romania, general manager of Emporiki Bank and executive vice president and chief operating officer at Egnatia Bank.

Piraeus Bank concluded the sale of its Albanian subsidiary Tirana Bank to Balfin and Komercijana Banka, boosting its core equity capital, Greece's largest lender said on Monday.

Morgan Stanley sees that while steps have been taken to drastically reduce Greek banks' bad loans, several obstacles remain in their way. The international bank's report on Monday followed meetings between Morgan Stanley officials and representatives from the country's four systemic banks, as well as from Grivalia, the Bank of Greece and the Hellenic Financial Stability Fund.

Yesterday's meeting between Finance Minister Euclid Tsakalotos and Bank of Greece Governor Yannis Stournaras just two days before the European Commission's report on the Greek economy reveals the government's concern over the problems that lie ahead, the most important of which is the looming problem of  non-performing loans (NPLs) that has burdened the banks and the economy in general.

The need for change at National Bank of Greece is "imperative," the lender's chief executive, Pavlos Mylonas, tells Kathimerini, heralding its transformation into a "modern bank that will respond to new challenges."

Greek banks remain cautious about the two alternative proposals for the securitization of nonperforming loans (NPLs) presented to them by the Hellenic Financial Stability Fund (HFSF) and the Bank of Greece. They expect to see details and want to know whether one or both of them obtain European Commission clearance, local bankers told a forum in Athens on Friday.

The Finance Ministry is putting off the issue of a five-year bond, which is all set in technical terms, until the domestic political dust settles and the effort to reduce the credit sector's bad-loan stock results in a breakthrough.

The quality of Greek banks' assets and their levels of capital constitute the biggest challenges for the sector in 2019, and these two factors will also determine the course of Greece's assessment by its creditors, Fitch analysts noted on Tuesday at an event in Athens.