Greek banks depend on financial earnings

Greek banks showed greater dependence on financial profits and a limited share of revenues from commissions in their results in 2020 compared to their peers in the rest of the eurozone, according to an analysis by the Single Supervisory Mechanism of all 112 lenders that it monitors across the bloc.

The supervising arm of the European Central Bank found that Greece’s four systemic lenders (Alpha, Eurobank, National and Piraeus) made at least a quarter of their revenues last year from financial profits and state debt swaps. In the rest of the eurozone that rate is much smaller, as financial profits average at about one tenth of total revenues.

SSM data particularly show that Greek banks’ financial earnings do not stem from the portfolios of securities for sale, but originate rather from extraordinary takings through Greek bond swaps, which confirms the fragile character of local lenders’ profits last year.

The same data point to the low share of revenues from commissions, which only account for an eighth of total takings, against an average rate of a third of revenues of banks in the the rest of the eurozone.