OPINION

Editorial

The announcement of the imminent merger between Alpha Bank and the National Bank of Greece carries exceptional economic and political weight. The nascent bank giant, which will form the 25th largest bank on the Continent, marks Greece’s entry into the world of great European challenges. The fact that each of Greece’s two largest banks that dominate the domestic banking system deemed that the size of each of these financial institutions alone was inadequate to preserve its dominant position inside the new environment shaped by the further incorporation of the Greek economy into the European one, pushing them into the decision to merge, is a clear signal in all directions. First, this move demonstrates that only large businesses are capable of surviving in the new environment. In any case, only a few dozen Greek financial groups have reason to believe that they can succeed in the European market on their own. If smaller businesses do not proceed, through mergers, to acquire a size that will enable them to compete for a share in the European market outside national borders – while at the same time constituting a driving force for numerous smaller firms that function around them – then Greece’s economy will definitely be downgraded. Given that in Greece it is the banking sector which is always first to make the major changes, the merger between Alpha Bank and the National Bank of Greece is expected to have a broader effect on market psychology. Let us hope that it will have a substantial effect on shaping a new mentality. In addition, the merger will help the National Bank of Greece to become independent from the government of the time, as the State’s share in the new financial institution will be considerably smaller. This means that it will be more difficult for the national economy minister of the time to veil government policy weaknesses by resorting to the bank’s treasury. The clear reinforcement of the private character of the new bank giant will force governments to be more diligent in the economic sector, moving further away from the statist logic into which they often lapse when faced with economic hardship. For many reasons, then, yesterday’s announcement fosters expectations of a manifold gain for the country’s path toward the EU and euro realities.