Regulatory Challenges in Greece’s Banking Sector

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Current Issues

Greek banks face significant regulatory challenges in three main areas: non-performing loans (NPLs), the impact of the Covid-19 pandemic, and consumer protection.

Non-Performing Loans (NPLs)

• The NPL ratio of Greek banks remains high
• Additional efforts are required for banks to deleverage their balance sheets and reduce their NPL portfolios

Impact of the Covid-19 Pandemic

Greek banks reported heavy losses after taxes and discontinued operations amounting to €688 million in 2020, compared with profits in the corresponding period of 2019.

Mitigation Efforts

• Fiscal, monetary, and supervisory measures taken by national and euro-area authorities have mitigated the impact of the pandemic

Consumer Protection

Banks are subject to consumer protection rules, including:

• General terms of business
• Pre-contractual and contractual information
• Advertising
• Unfair commercial practices

Enforcement

The General Secretariat of Commerce and Consumer Protection is responsible for enforcing these rules.

Future Regulatory Policy

In the coming years, Greece’s legal and regulatory policy is expected to move towards enhancing the Capital Market Union.

Key Priorities

• Credit risk management
• Capital strength
• Business model sustainability
• Sound governance practices
• ESG framework alignment

Note: The information above is accurate as of February 19, 2021.