The funding profile of Greek banks is strong, their capital base and asset quality improved and their revenue growth significant, notes the credit rating agency DBRS in its report on the four systemic banks (Alpha Bank, Eurobank, National and Piraeus) ).

The report notes that “Greek banks are unlikely to face significant funding and liquidity pressure given the broad base of household deposits and adequate liquidity buffers.”

DBRS reports that Greek banks had total profits of €3.7 billion in 2022 against losses of €4.7 billion in 2021.

Their increased income last year came from all sources such as net interest income, net commissions and others, while their cost management remained sound despite inflationary pressures.

Loan loss provisions and risk costs were significantly reduced in 2022 and their asset quality further improved due to de-risking, low new NPL inflows and increased new loans.

“Their abundant, growing and broad deposit base provides Greek banks with a rather stable, if modestly diversified, funding mix. Liquidity was healthy and capitalization improved after de-risking,” the report added.

DBRS vice president Andrea Constanzo notes that banks’ “capital cushions” are “enough to absorb unrealized losses on the bonds they have in their portfolio (at amortized cost)” due to pressure on their funding and liquidity after the collapse of Silicon Valley Bank and Signature Bank.