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Greek bank tests to be announced next week: central banker

27 February 2014, 13:18 CET
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(ATHENS) - A delayed announcement on Greek bank stress tests, which has held up a capital increase by one major lender, will be made next week, the Bank of Greece governor said on Thursday.

"The Bank of Greece next week will announce the results of the exercise," the governor, George Provopoulos, said in a statement.

According to Greek reports, stress tests by private analysts BlackRock indicate that 5-6 billion euros ($7-8 billion) will be required to help the banks cope with challenges, including mounting bad loans.

However, the Financial Times newspaper reported on Monday that according to IMF estimates, nearly 20 billion euros could be required.

On Wednesday, Provopoulos met a mission from the so-called troika of Greek creditors -- the European Union, International Monetary Fund and the European Central Bank. Their auditors are in Athens for a scheduled audit of the country's fiscal reforms.

The governor said on Thursday that meetings between BoG staff and troika experts would continue on the "technical details related to the methodology and results of the exercise."

Provopoulos said that BlackRock had placed emphasis on the loan portfolio of Greek banks, amid market estimates that the share of non-performing loans is over 30 percent, and rising.

The stress test results were originally supposed to have been announced in December.

They have held up a planned capital increase by Eurobank, one of the four main lenders, which was recapitalised with state funds last year.

All four of Greece's main lenders -- National Bank, Piraeus, Alpha and Eurobank -- were recapitalised as part of the Greek bailout.

A sum of 50 billion euros from Greece's EU-IMF rescue loans was earmarked for the recapitalisation after heavy losses suffered by Greek banks taking part in a writedown of privately-held Greek government bonds last year.


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