National, Piraeus hit by review uncertainty in Q1

National, Piraeus hit by review uncertainty in Q1

Uncertainty over the Greek bailout review took its toll on Piraeus Bank and National Bank of Greece (NBG) in the first quarter as the country’s two biggest lenders focused their efforts on cutting bad debts.

Greece’s economy contracted in the first three months of the year but less than in the final quarter of 2016, flash estimates by its statistics service showed last week, as jitters over the conclusion of a bailout review hurt business confidence.

Athens finally reached a deal on reforms with its foreign creditors in early May after six months of negotiations that harmed economic activity and made life harder for Greek banks.

The banks are still struggling with problem loan portfolios after a deep, protracted recession pushed unemployment to record highs, making it hard for borrowers to service their debts.

Piraeus, which is 26.2 percent owned by Greece’s bank rescue fund and is the country’s largest bank by assets, on Wednesday reported a narrower net loss of 6 million euros thanks to lower provisions for impaired loans.

But although NBG, Greece’s second largest lender, said it was profitable for a third straight quarter, net earnings fell sharply in the period as its bad debt provisions rose.

NBG, which is 40 percent owned by the HFSF bank rescue fund, posted net profit of 5 million euros, excluding assets held for sale and discontinued operations, versus net earnings of 73 million euros in the fourth quarter.


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