The National Bank of Greece (NBG), the country’s oldest bank, has returned to the bond market. This is a first for Greek banks since 2014, when NBG’s last bond issue racked up around 350 million euros over a period of three years.
Panayiotis Thomopoulos, former Chairman of the NBG board, recently commented that “if the economy continues to improve, the banking sector will quickly follow. In two years’ time, Greece will be an entirely different country”. He further explained that to encourage investment, the government will have to cut taxes and bureaucracy.
The NBG aims to further reduce non-performing loans that have reached up to 48% of total loans in the midst of the crisis. “In recent years, we have reduced our staff by one-third and sold our branches to reduce costs”, said Thomopoulos. He added that gaining profitability will allow to provide new loans needed to restart entrepreneurship.
The banking group has sold several assets, including the Turkish bank Finansbank to Qatar National Bank for 2.7 billion euros, as well as its subsidiary in Bulgaria for 610 million euros to KBC Bank Ireland and its insurance business for 718 million euros to Dutch Exin.
Mr. Thomopoulos further ensured that the bank’s governance reform will allow for more oversight and transparency in transactions.
The NBG placed foreign directors on its board: Claude Piret, CEO of Dexia Group, a Franco-Belgian group; Marianne Økland, with experience in Scandinavia, Slovenia and Iceland; and Mike Aynsley, an Australian banker expert in bad loan-burdened banks.