The Banking System in GreeceEFFECTS OF WORLD AND GREEK CRISIS

ΔΑΒΤΥΑΝ ΤΡΙΑΝΤΑΦΥΛΛΙΑ 2370

ΔΗΜΑΣ ΧΡΗΣΤΟΣ 2373

ΔΗΜΟΣ ΠΑΝΑΓΙΩΤΗΣ 2374 ENGLISH FOR ACADEMIC PURPOSES IV

ΠΟΛΥΧΡΟΝΙΑΔΟΥ ΜΑΓΔΑ 2502 UNIVERSITY OF IOANNINA,

ΧΑΤΖΗΛΑΖΑΡΟΥ ΛΑΖΑΡΟΣ-ΑΝΤΩΝΙΟΣ (G.L.) 2557 DEPARTMENT OF ECONOMICS

Contents 2. Greek Economic Crisis 2.1 Greek crisis and Worldwide Crisis

2.2 Effects of Greek crisis on Greek economy

3. Greek crisis and banking system 3.1 Importance of banking sector for Greek economy

3.2 Effects of Greek crisis on banking system

3.3 Stress Tests

4. The structure of the banking sector 4.1 The bail in

4.2 The Hellenic Financial Stability Fund

5. Future Prospects

Crisis. Where? Why? How?

2007. The international financial crisis. Stock markets. Indicators going “crazy”. U.S.A‘s banking precarities Weakness on loan servicing.

Crisis affected Greece.

The major effects of the crisis were: Unemployment Number of banks in Greece fell by 17% Internal devaluation of the currency.

Troika and Memoranda 1&2

And now Greece needs help.

The debt is huge. Viable? No! ECB (European Central Bank) EC (European Commission) IMF (International Monetary Fund)

Thus European Union created: EFSF ESM

Banks are very important. Why? reverse selection moral hazard

Behavior when in danger!

What? Asymmetric information problem

When? Before transaction

Non creditworthiness units act unexpectedly effectively to be financed with a loan (Mishkin, 1996)

Banks “suffer”…

the further reduced rate of growth, the increase in lending rates, the reduce of economic activities, Increasing delay in payments of loans.

Stress Tests.

Deficiency of loaning capitals. 6.4 billion Euros. Peireos 425 million Alpha 262 million Ethniki 2.183 million

Where will they find these amounts?

1st to lose are the shareholders Creditors or bond holders Uninsured deposits (over 100.000) Eventually all the deposits

The bail in.

HFSF. (Hellenic Financial Stability Fund)

What about the future?

Is really HFSF necessary? Private businesses. Why belong to the state? Bureaucracy. What about the European capital and money

market?

There is still hope.

http://www.hfsf.gr/files/announcement_20140328_el.pdf

http://www.hfsf.gr/files/announcement_20140404_el.pdf

HFSF data for Eurobank, Alpha and Peireos banks.

Thank you for your attention.