S&P Upgrades Four Greek Banks after Athens Eases Capital ControlsSoutheast Europe | August 3, 2016, Wednesday // 09:47| views
File photo by EPA/BGNES
Ratings agency Standard and Poor’s upgraded Alpha Bank, Eurobank Ergasias, National Bank of Greece and Piraeus Bank to CCC+ from SD (selective default), with a stable outlook, Greek newspaper Kathimerini reported on Tuesday.
The upgrade came after a further relaxation of capital controls in Greece from the beginning of the month.
“We view the lifting of this ban as a significant relaxation, as it could allow for cash deposits to be brought back into the banking system, raising confidence in the Greek banking sector,” Standard and Poor’s said, according to ekathimerini.com. “We expect some minor deposit inflows in the coming months.”
Greece has decided to ease stringent capital controls introduced about 13 months ago in the hope of luring back some of the cash withdrawn from Greek banks at the height of last year’s crisis.
Deputy Finance Minister George Chouliarakis has said that he expected up to EUR 4 B in fresh deposits would flow into banks once the controls were lifted.
The Finance Ministry has decided that from the start of August new deposits won’t be subject to any capital controls and higher limits on withdrawals of money brought in from abroad will enter into force.
About EUR 43 B have fled the Greek banking system in just over a year amid concerns over the country’s future in the eurozone.
Standard & Poor’s downgraded its ratings on the four Greek banks to selective default at the end of June last year, citing the imposition of banking restrictions in Greece at the time and the rating agency’s opinion that defaults by the Greek lenders were inevitable within six months without additional support from the European Union.