Banks to post increased provisions in Q4 data

The country’s systemic banks are to start publishing their financial results for the October-December period and for all of 2015, with an eye on the pressures and concerns that 2016 are expected to bring.

First up will be Eurobank on Wednesday, followed on Thursday by Alpha Bank. Next week Piraeus Bank will issue its financial figures for 2015, one day before National Bank.

Bank officials say that the last quarter of 2015 was no different to previous ones, with the credit sector flying low as reduced demand, along with prevailing uncertainty and a lack of liquidity, did not allow for the expansion of banking activity.

While the lenders no longer face the threat of deposit outflows after the imposition of capital controls in late June, continuing uncertainty makes the return of deposits that have already exited the system and are hidden in safe deposit boxes or in mattresses unlikely at best, even though that would be an essential factor for the stabilization of the credit system.

On the positive side for Q4 and last year in general, is the slowdown in nonperforming loans compared to original estimates, while a considerable decline in deposit interest rates has given revenues a significant boost. Despite the small growth of NPLs, banks will show increased provisions for the last quarter of 2015 as they attempt to protect themselves from a possible deterioration of conditions in the current year – a growing possibility given the delay to the bailout program review and the pressures of the refugee crisis.