The Greek banking system will not face the need of a fourth recapitalization, Bank of Greece vice-governor Theodoros Mitrakos said on Friday.
Addressing an event on “Surviving from NPLs and auctions”, organized by Mavrakis-Real Estate Chartered Surveyors, Mitrakos rebuffed rumors over the possibility of a new recapitalization of Greek banks, saying “the figures presented were not right as the Greek banking system has stabilized”.
The central banker underlined that the Greek banking system was robust and stable, with high capital adequacy rates, “much higher than European average rates”. The equity ratio of Greek banks was 18 pct, up from an average European ratio of 16 pct. “At the current period, Greek banks have no problem in terms of capital and stability,” he said.
Mitrakos acknowledged, however, that the banking system has serious challenges to face, such as non-performing loans, but noted that actions and timetables have been set by the Bank of Greece and commercial banks, in cooperation with the Single Supervisory Mechanism of the European Union. “The first figures from the implementation of a timetable are encouraging. A target set to reduce NPLs by 40 billion euros by 2019 I believe it is optimistic but feasible,” he said.
Speaking to ANA, Mitrakos said: “A process of target setting with regular quarterly reporting has begun. In the last three quarters of 2016, the value of NPLs not only stabilized at 107.7 billion euros, but fell by 1.0 billion euros, while their rate stabilized at 45.1 pct of total loans”.