Almost two in every three Greek companies (63 percent) are deemed to have a high credit risk, compared to just 6 percent in 2009, according to data compiled by ICAP, as the Greek production base is collapsing rapidly.
Most Greek firms now have serious or very serious problems in covering their obligations, along with weak financial results and particularly low competitiveness. This is a combination which generates major doubts about their sustainability.
Another 27 percent of enterprises are on the verge of entering the above category too, with an increased risk, as they show vulnerability to adverse financial conditions, low economic performance and low competitiveness.
In other words, 90 percent of enterprises in Greece find themselves in the zone of high or increased credit risk and according to bank rules should not be entitled to bank financing. Therefore the credit system is up against a huge problem, as in order to help the revitalization of the economy it will have to increase credit levels, but the companies that are actually creditworthy and fulfill the banks’ criteria are very few indeed.