The banking sector, responding to challenges caused by the recent health crisis, supports directly and actively businesses and households by implementing integrated action plans under two main axes: (a) moratoria of instalments for thousands of affected businesses and households and (b) rapid financing of businesses in order to help them recover at this turning point of the economy. In doing so, HBA member-banks are helpers in the country's effort to face the health crisis and to recover as soon as possible, returning back on track of the economic growth. The banking industry traced the actual needs of the economy and responded promptly.

More specifically:

A.     Moratoria of loan instalments for 179.000 beneficiaries

Banks, seeing into the risk of reduced liquidity due to the lockdown, reacted immediately by voluntarily suspending payments of loan instalments for affected businesses, exempting them from payments of the capital for at least 6 months, while for those committed to maintaining jobs, the interest for one quarter was subsidized by public funds. It has already been decided to extend the interest on business loans by two months, using public funds. Respective facilitation measures have also been implemented for households. The combination of aforementioned measures created a liquidity “cushion” of up to 5 billion euros, from which 179.000 businesses and individuals were benefited and 75% of the moratoria requests were satisfied.

At this point it should be pointed out that said measures complement the bilateral loan arrangements the banking system continues to offer, by providing an enhanced protection grid for all those in actual need, or simply in need of a facilitation. In particular, in addition to moratoria granted to performed loans of businesses and individuals due to the pandemic crisis, banks have already adjusted and continue to adjust a large part of non-performing loans, by offering favorable arrangements to borrowers, aiming in the reduction of NPLs and release of resources to finance the economy. Indicatively, loans of approx. 80.000 debtors, amounting to 10 billion euros, have been settled during the period July 2019-May 2020, which shows banks’ effort and willingness, while the pace of settlement has not declined even during the period March-May, i.e. at the heart of the COVID-19 pandemic crisis.  Thus, 260.000 businesses and households settled or suspended their debts in a short period of time.

B.     Financing of the Greek Economy

Provision of capital of 3 billion euros coming from the liquidity of the banking system

Even before the activation of the State's financial tools, banks proceeded with own means, to provide liquidity to businesses for covering of all kinds of their needs. Based on published data during the first quarter of 2020, new financing of the Greek banking system towards businesses and individuals increased by 3 billion euros.

Channeling funds from State and European resources

In a very short period of time, banks have further exploited and leveraged available State funding resources, and have already proceeded in making good use of them. In particular, the banking system, through the Entrepreneurship Fund (TEPIX II), finances Small and Medium-size Enterprises (SMEs) with the amount of 2 billion euros. It is worth noting that for said program, only the absolutely necessary collateral was requested, since the loan is a 60% credit risk for the bank and a 40% credit risk for the Hellenic Development Bank (HDB). Additionally, through the HDB's guarantee program, there will be further financing of small, medium and large-size businesses of 7 billion euros in total. Banks’ approval procedures are running at a feverish pace, in order for the liquidity to reach beneficiaries who meet the defined credit criteria.

Based on above facts, banks estimate that, during 2020, approx. 17 billion euros will be channeled into the economy.

Banks, recognizing their key role in the recovery of the economy and the society, will continue to implement programs to support businesses and individuals, based on objective criteria, fair procedures, with respect to competition rules and a firm focus on the protection of businesses, households, depositors, Greek taxpayers and the public interest.

The Hellenic Bank Association is committed to frequently inform the Greek society about its members’ actions, which aim in supporting entrepreneurship and households.