Greek bank shares drop due to overreaction

hellenic exchange

hellenic exchange

A Financial Times report referencing the significant drop in bank share prices yesterday at the Athens Stock Exchange, noted nonetheless Greek banks are still well recapitalised and follow the schedule agreed with the European Central Bank (ECB) for reducing non-performing exposures.

According to a senior Greek banker in the Financial Times piece, the reason for the retreat in prices which came after large pressures on Greek banks' shares on Wednesday, was simply due to an overreaction from a weak market dominated by short selling.

With regards to Piraeus Bank, whose shares experienced the most pressure, the senior Greek banker said that the Bank has reduced its non-performing exposures to EUR 29.4 billion after selling problematic loans of EUR 5.4 billion.

He points out that Piraeus Bank has no time to complete its capital enhancement and is examining the markets to seek the best opportunity for the successful issuance of Tier 2 Capital Securities, which is not tangible to shareholders, a version included in the capital plan which will enable it to strengthen its capital stock.

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