Tactical retreat
The decision by National Bank of Greece to sell its Turkish unit Finansbank should be a cause for concern.
Taking over the Turkish lender in 2006 was a very smart move that was unjustly targeted by skeptics. Now, its sale is a sign of the tactical retreat on the part of Greece’s lenders which had expanded in the broader region after cementing their presence at home.
Will Greece’s banking system ever make a comeback? If the past is any guide, it seems very likely because Greeks are no strangers to the art of outward-looking entrepreneurship.
That said, any return to growth requires political stability. Greek banks must be injected with fresh capital and their healthy parts must be left to operate according to purely banking criteria – and not under the constant fear of being stigmatized.
The success of the Finansbank takeover was thanks to the fact that those who made the decision were immune to the prejudice.
