HFSF releases guidelines on selecting board directors for systemic Greek banks

The Hellenic Financial Stability Fund on Tuesday published its revised Guidelines on the Board of Directors’ selection and appointment process at Greek systemic banks (Alpha Bank, Eurobank, National Bank of Greece and Piraeus Bank).

According to its statutory role, HFSF has the objective to contribute to the maintenance of the stability of the Greek banking system, for the sake of the public interest. Moreover, HFSF’s role is to evaluate the boards and their committees, as well as the corporate governance arrangements of credit institutions with which the Fund has signed Relationship Framework Agreements.

It is clear that a formal, structured and transparent selection and appointment process for board members is essential, in order for the Greek systemic banks to regain the confidence and trust of all stakeholders and shareholders. Moreover, improving the understanding and efficiency of the process in practice is essential for enhancing board effectiveness.

In this context, the HFSF communicated to the systemic banks in February 2016 relevant guidelines, which reflected the key parameters that a process, as such, should fundamentally incorporate. Indeed, the Greek systemic banks improved the selection and appointment process of new board members, succeeding in attracting new, highly skilled and experienced board members.

Following the completion of the 2017 assessment of the board and corporate governance arrangements of the Greek systemic banks and taking into consideration that banks are in the process of searching for new board members, the HFSF considers it important to publish the updated Guidelines document.

This HFSF initiative is among its strategic objectives to continue its efforts to provide and promote best practices and standards aimed at improving the corporate governance framework and board performance of systemic Greek banks.