Banks fear stress test terms will be stricter


After their contacts in Washington during the annual meeting of the International Monetary Fund, local banks are concerned that the IMF has managed to impose most of its positions despite hopes to the contrary.

Although consultations are continuing and no final decision has been made yet, the fact that the European Central Bank’s stress tests have been brought forward for Greek banks compared to their eurozone peers leads to suspicions that the methodology and technical parameters used for the tests will be stricter, to appease the IMF.

The Fund has long insisted that the 10 billion euros available in the context of the ongoing bailout program must be channeled to banks so they can proceed to greater write-offs of nonperforming loans.

Therefore the next few months until the stress tests begin and the terms become clear will be a period of great uncertainty and instability for domestic lenders. It is no coincidence that since mid-July, when the IMF-ECB clash on the state of Greek banks started, the sector’s stocks in Athens have dropped more than 30 percent.

On Thursday the chair of the ECB’s Supervisory Board, Daniele Nouy, stated that the reforms to tackle NPLs will require the strengthening of the Greek justice system.