BUSINESS

Credit sector is set for more consolidation

TAGS: Banking

The possibility of mergers between Greece’s systemic banks is strong according to 78 percent of credit sector officials, while even more professionals in the sector (79 percent) anticipate a shrinking of the network by more than 20 percent.

These conclusions stem from a videoconference organized by Ernst & Young Greece, aimed at contributing toward the understanding of the significant challenges the local banking system is facing due to the coronavirus pandemic.

Only 22 percent of participants saw all four banks being necessary in the aftermath of the crisis, while just 20 percent said they believed the shrinking of the branch networks will be marginal and stores will remain open and transform.

Giorgos Papadimitriou, head of financial services at EY Greece, said the pandemic will bring the reduction of nonperforming loans that the banks had been making progress on to a halt, as many calculations valid until March are now being revised.

He added that “the consequences of the pandemic will put the stamina of the credit system to the test,” and as the crisis affects the entire ecosystem, “banks will have to proceed to their restructuring and transformation while improving their efficiency.”

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