ECONOMY

BlackRock is confident on bank sector prospects

The Greek banking sector received a vote of confidence on Thursday from BlackRock Solutions, the very company that probed it, ahead of the Bank of Greece’s announcement of the stress test results next month.

The head of the US firm, Larry Fink, met yesterday in Athens with Prime Minister Antonis Samaras and Bank of Greece Governor Giorgos Provopoulos, following the completion of the stress tests on local banks’ loan portfolios.

Fink stressed that the Bank of Greece has taken all the necessary measures for the restoration of the credit sector’s credibility. He further noted that “the results of the first exercise laid the groundwork for the successful recapitalization of Greek banks, strengthened their transparency considerably and boosted the confidence of depositors and investors.”

The results of the new stress tests conducted this year will enhance the sector’s credibility further. Fink stated that “the restructuring of the banking system along with the handling of the fiscal and external imbalances are paving the way for the Greek economy’s recovery in the coming years.”

Provopoulos said that “despite the greater-than-expected deterioration of macroeconomic conditions during the previous exercise, the losses effected were within the limits estimated by BlackRock, which illustrates that the exercise was entirely successful. The restructuring of the banking sector constitutes the cornerstone of Greece’s effort to emerge from the crisis and become a modern and competitive economy with sustainable growth and an increase in employment.”

Meanwhile Fitch maintained on Thursday the credit rating of the four systemic Greek lenders (Piraeus, Alpha, National and Eurobank) at B- in a report on the banks of the European south. It noted that despite their recapitalization, the risks resulting from the weak economy persist, and did not rule out the need for additional capital.