Bank EPS seen 16 pct off in 2010

Greece’s banks are expected to show a 16 percent year-on-year drop in earnings per share (EPS) this year versus an estimated 3 percent EPS drop among non-banks, according to a leading brokerage. Piraeus Securities said in an outlook published yesterday that its base scenario for 2010 envisages «a double-digit EPS decline in 2010 courtesy of lower [profit] margins and a higher number of outstanding shares.» «We also assume spreads will tighten in the course of the year in tandem with the successful execution of the government’s budget,» the brokerage said. Lenders have been hit hard by fears over the country’s fiscal health and Greece’s economic downturn, resulting in shares in the sector dropping 33 percent in the last month. In comparison with markets abroad, Greek stocks look attractive, Piraeus said, adding that they trade at a 10 percent discount in comparison with a weighted average basket of European markets.

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