The challenges faced by the Greek banks and the Greek economy as a whole were mentioned by the Bank of Greece Governor Yiannis Stournaras, speaking today at the event of the Greek-Israeli Chamber of Commerce and Technology.

For the economy, the BoG commander argued that ‘Economic policy should remain committed to the implementation of reforms, as they will ensure the creation of a sustainable productive model that will help attract investment in the country with the aim of accelerating economic growth.“

Referring to the banking system, after praising banks’ achievements in recent years, the BoG commander pointed out that the prospects of the banking sector depend on the country’s macroeconomic course, which is influenced by international developments. Any deterioration of international financial conditions, amid geopolitical or other disruption, may adversely affect the global financial system, as well as the financial situation of businesses and households in Greece.

Mr Stournaras emphasized the need for further boosting banks, as credit institutions will be able to boost their supervisory funds while improving their quality, helping to faster DTC depreciation. As the reinforcement of the CET1 index, it is a necessary condition for further upgrades of the economy within the investment category, as the health of the banking system is a key criterion for evaluation by international firms.

In addition, the BoG commander said that the high dependence of Greek banks on interest revenue makes them vulnerable in periods of interest rates, such as the one we have. For this reason, it called on banks’ administrations to broaden their loan portfolio and to boost their revenue from supplies such as boosting revenue from asset management and bank insurance products.

Referring to the course of the Greek economy, Mr. Stournaras argued that the positive course of the economy in recent years has resulted in the upgrading of the Greek State’s credit rating in the investment category by almost all major ratings. Indeed, the ongoing upgrades emerged in a period of increased international and European political uncertainty and geopolitical unrest. According to current forecasts of the Bank of Greece, the GDP growth rate in 2024 is estimated at 2.3% and is expected to remain on these levels on average the next three years

“The successes recorded in recent years are an indication that the economy is on the right track. However, the effort to economic recovery from the ten -year debt crisis and real convergence of income with the European average must continue to continue“, Mr. Stournaras said.