Moody’s sees NBG securitization as credit positive

National Bank of Greece’s conclusion earlier this week of the securitization of business loans which would allow it to raise up to 300 million euros in medium-term funding has been deemed “credit positive” by Moody’s.

“The deal is credit positive for NBG because it lowers NBG’s funding cost and provides an alternative funding source that will help the bank reduce its dependence on emergency liquidity assistance (ELA) from the Bank of Greece,” Moody’s said yesterday.

NBG said it would place the senior notes with the European Investment Bank, the European Investment Fund and the European Bank for Reconstruction and Development, in what is the first securitization transaction of its kind in Greece since 2007.

“We consider this SME securitization to be a sign of increased confidence toward both NBG and Greek assets as collateral, paving the way for similar transactions with multilateral European entities that have a mandate to support Greece’s SME sector,” added Moody’s. “However, given the deep challenges the market continues to face, we expect private investor interest for such deals to remain low until there is an ongoing improvement in Greece’s economy.”