OPINION

Seeking profits without any risks

All over the world, business activity is subject to two presuppositions – risk and profit. The shareholders of any particular company always undertake certain risks with any individual venture and, subsequently, reap the benefits that such an enterprise may bear. This is how capitalism has achieved great things in every Western country – every country, that is, except Greece. The unfortunate fact is that in our country business transactions, more often than not, do not follow the rule of presupposing risk. When embarking on a business venture in Greece, all that is needed are the necessary political connections or adequate political pressure to ensure that the state undertakes the risks of any investment while the businessmen simply pocket the gains. And this can be done in many different ways – for example by approving shortsighted subsidies or loans doomed never to be repaid (and it is always the state that guarantees the latter). The recent purchase of a majority share in Turkey’s Finansbank by National Bank of Greece (NBG) is a major business move. All of National Bank’s shareholders are now in an advantageous position for undertaking a risk in order to enjoy future benefits. But some of those shareholders want to transfer the cost of these risks onto Greek society as a whole. Certain insurance funds and some labor unions are seeking state-backed loans so that they can participate in the share capital increase. But this should not be happening. All NBG’s shareholders – from the very smallest to the largest – are obliged to gamble with their own money. If they believe that the Finansbank purchase is really advantageous, then they should buy a share in the Turkish bank without shifting the responsibility for the risk onto all Greek taxpayers. The increase in NBG’s share capital is a business initiative and should remain businesslike on all levels.