Karatzas sees normalcy

Greek consumers have yet to be affected by the uncertainties generated by the war in Iraq, as they continue their banking transactions as normal, the head of the country’s largest bank said yesterday. National Bank Governor Theodore Karatzas’s affirmation that the banking sector has yet to see a fall in business as a result of the war came on the heels of similar reassurances from the government and business leaders in recent weeks. The Greek economy is expected to forge well ahead of other eurozone countries this year on the back of strong inflows of community funds and infrastructure projects related to the 2004 Olympic Games, both Premier Costas Simitis and Finance Minister Nikos Christodoulakis have repeatedly stressed. Shielded by these two factors, Greece has been little affected by the fallout from the war, they said. «There are no signs of concerns, our clients’ actions show that everything is developing normally. Clients are not cutting back on their activities or facing problems servicing their loans,» Karatzas said. Economic surveys, however, appeared to suggest otherwise. Greek industries and consumers felt less confident in March, although the drop in confidence was less than in other eurozone countries, the European Commission said on Monday. The survey was conducted in the runup to the outbreak of war in Iraq. Referring to the violent fluctuations on the stock market in recent days, Karatzas said it appeared to have the hallmarks of a reverse bubble. Equities have yet to come out of a three-year bear run, with the general share index shedding more than 3 percent on Monday to a 52-week low. Bad psychology is once again creating extreme behavior, similar to the bubble of 1999, when the stock market reached a peak of 6,355 points, Karatzas said.