Thursday August 21, 2014 Search
Weather | Athens
29o C
23o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Listed firms act as access to financing tightens

By Anestis Dokas

Greek banks are reportedly refusing to offer listed companies guarantees that they will be able to continue meeting their urgent liquidity requirements in 2012.

Senior executives of firms that managed to settle their debts last year and maintain open credit lines this year after protracted negotiations with lenders told Kathimerini that the current political flux and the postponement of bank recapitalization has cast a heavy cloud of uncertainty over the future. At best, they note, the banking system and businesses have adopted a wait-and-see stance. Its impossible to predict where the country will stand politically one month from now and no one can rule out the possibility that the government will declare a payments freeze one month from now if the countrys international creditors suspend the scheduled installments.

Banks have notified listed companies that they now control after the securitization of their debts to put financial plans on hold until the political landscape becomes clearer. This is especially trying for firms that cannot reduce production, as that would jeopardize their cash flows. Many of them have tried to improve their survival prospects by reorienting their activities abroad, given the bleak prospects of the domestic economy.

The lack of liquidity is prompting many firms to sell or reduce their holdings in order to protect their assets.

Even healthy firms are beginning to feel the liquidity pinch, and this has not escaped the attention of foreign portfolio managers who are watching the Greek market ready to snap up any opportunities. The overall picture that has emerged for the first quarter of the year is that two out of every three listed firms are facing very acute cash flow woes. On average, firms are two months behind in salary payments and have activated compulsory leave measures (two days a month), anticipating an average reduction in the wage bill of around 10 percent.

Many firms will wither in 2012, given the sorry state of the Greek business environment. We do not want to be among them, so the group will conduct itself as conservatively as possible in order to deal with the situation, said Evangelos Mytilineos, chairman and CEO of industrial conglomerate Mytilineos Holdings.

Tumbling turnover has compounded the problems posed by the lack of financing. For instance, the situation is especially tough in the construction sector, as firms involved in public works are being led to collapse. Realty developers who were in the middle of projects when banks froze further credit are in an equally sorry state, while the recession in the tourism sector is giving rise to a similar picture for many cash-strapped hotel businesses.

Even the food sector -- traditionally the most resistant of Greek industries during economically challenging periods -- is seeing sales fall as consumers cut back to the absolute essentials or turn to cheaper options.

Also there have been reports that listed firms with property assets are being refused operating capital loans due to their supposed risk of default.

ekathimerini.com , Monday May 14, 2012 (23:01)  
Greek stocks post rise of 0.99 percent
Banks reject stress test concerns
Greek energy minister requests gas back-up
Greece an alternative route for South Stream, report suggests
Botched steroid deal led to Mani murders
A deal to sell steroids gone wrong appears to have been the reason for the murder of two bodybuilding fanatics, aged 25 and 26, whose bodies were found on Tuesday in a ravine on the outskirt...
Public works near completion, minister says
Eight public works projects, including the completion of a new stretch of highway at the notorious Maliakos Gulf in central Greece, are due to be completed by the end of the year Infrastruct...
Inside News
SOCCER
Greek soccer officials in refereeing probe to face prosecutor on Sept 15
Eleven soccer officials were on Wednesday given until September 15 before they have to face prosecutor Aristidis Koreas, who is investigating allegations that the draws to decide which match...
ATHLETICS
Long jumper Tsatoumas takes Greeces second silver at European Championships
Greece won its second medal at the European Athletics Championships in Zurich, Switzerland, on Sunday with Louis Tsatoumas coming second in the long jump. Briton Greg Rutherford won the even...
Inside Sports
COMMENTARY
Logged out of reality
It is a global phenomenon, and we have yet to fully grasp its implications for democracy and the functionality of Western states. The Internet is a bottomless well of information and a vast ...
EDITORIAL
Manipulated institutions
Greeces leftist opposition must not manipulate an institution as important as the President of the Republic for the sake of political ends. Regrettably, SYRIZA leader Alexis Tsipras appears...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
RECENT NEWS
1. Botched steroid deal led to Mani murders
2. Greek stocks post rise of 0.99 percent
3. Banks reject stress test concerns
4. Greek energy minister requests gas back-up
5. Greece an alternative route for South Stream, report suggests
6. Public works near completion, minister says
more news
Today
This Week
1. Greek current account surplus widens in June
2. Two missing men found shot dead near Kalamata
3. Logged out of reality
4. Greek firms see 30 pct rise in PayPal payments from abroad in 2014
5. ECB in policy limbo, boxed in by its own plans
6. Greece to give children at primary school road safety lessons
Today
This Week
1. Carved sphinxes at Ancient Amphipolis tomb will not be removed
2. Canadas fiscal adjustment has lessons for Greece
3. Treating Amphipolis with care
4. Greece to offer law on restructuring bad loans next month
5. Greeces recession eases as country nears end to six-year slump
6. Ministry sys no to debt collection agencies
Find us ...
... on
Twitter
... on Facebook
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright 2014, H KAΘHMEPINH All Rights Reserved.