Greek banks will achieve goal of reducing NPLs this year, Eurobank CEO says

Greek banks will achieve a goal to reduce their non-performing loans by 10 pct this year as the economy was entering a period of growth rates in 2017 after several years of recession, Fokion Karavias, Eurobank’s CEO said on Thursday.

Addressing a panel on European banks in the framework of a conference held in Cyprus on the occasion of the annual assembly of EBRD, Karavias said it would take five or six years of economic stability for a drastic further reduction of NPLs in the country.

The Greek banker said the Bank of Greece and the Finance ministry were drafting a road map for a further gradual lifting of capital controls and said he expected a full lifting of capital controls to begin gradually in 2017 and continue in 2018.

Commenting on the domestic banking system, Karavias said that after three recapitalizations it enjoyed adequate capital and it will not need a new recapitalization ahead of pan-European stress tests in 2018.

Eurobank’s CEO noted that Greek banks were eager to fund healthy investment plans and need of individuals, but noted there was an issue of low healthy demand. He said that the future will show what would be the right number of banks operating in Greece and noted that bank networks drastically reduced in the last few years. He added that any further reduction in numbers could raise concentration issues.

“I don’t think this will happen in the near future,” he noted.