Greek banks face down the crisis
Greek banks’ share prices plummeted in 2008 – even before Lehman collapsed. Despite this, as well as higher inflation, slower economic growth and more taxes, they have ploughed on with ambitious regional expansion plans. Can Greek banks defy the global financial crisis? Dominic O’Neill reports from Athens.
ATHENS AIRPORT IS brimful with tired and irate tourists, desperate to leave Greece. It is a beautiful autumn evening but a UK package travel airline has just gone bust, stranding thousands of passengers.
Many Greeks would be glad to see them gone, preferring Russian or Chinese tourists, who spend more.
But unfortunately this is a story repeated throughout the Hellenic economy. Greece has benefited immensely from joining the European Union long before other countries in southeastern Europe. But now mistakes in the west are complicating Greek ambition in the east.
"The general focus on increasing and strengthening our presence in markets abroad has not changed," Nicholas Nanopoulos, chief executive of Eurobank EFG, the second-biggest bank in Greece by assets, tells Euromoney. The stances of the other big Greek banks are similar.
However, Greek banks’ rapidly growing operations in central and eastern Europe are still only a few years old. Their head offices are funding these foreign emerging market commitments and proportionate rewards for the investments remain to be seen.
Previous reliance on debt markets in western Europe has become unviable. Moreover, the Greek economy is still primarily beholden to western demand – for holidays in the sun and for goods transported through the Greek-dominated world shipping industry.