Today, the S&P rating agency upgraded the rating of Greek banks, noting the significant progress they have made.

• credit rating of the National Bank and Eurobank from “B+” to “BB-” with a positive outlook

• Rating of Alfa-Bank from ‘B+’ to ‘BB-‘ with a stable outlook.

• Credit rating of Piraeus Bank from ‘B’ to ‘B+’ with a ‘positive’ outlook

• credit rating of Aegean Baltic Bank up to ‘B+’ from ‘B’ with a stable outlook

• rating of Eurobank Holdings from ‘B-‘ to ‘B’ with a ‘positive’ outlook

• Alpha Services and Holdings is rated B- to B with a stable outlook and

• Piraeus Financial Holdings outlook from stable to positive, long-term rating affirmed at ‘B-‘.

In a statement, S&P says that Greek and Cypriot banks will increasingly reap the benefits of years of cleaning up their balance sheets, restoring their profitability and now raising interest rates.

It also notes that these banks have made significant progress in rebalancing their funding profiles, thanks to strong deposits and significant deleveraging on their balance sheets, which now puts them well placed to repay targeted long-term loans they have taken out from European banks. Central bank.

Greek and Cypriot banks confirmed in 2022 that they have reached a turning point on the road to normalization, S&P notes. After several years of significant NPL sales, securitizations, write-offs and collections, all systemically important banks in Greece and Cyprus were able to register NPLs of less than 10% of their total loans. In addition, the caution they have shown in recent years in lending shows that the potential deterioration in the quality of their assets is expected to be much more limited than in past crises, says S&P, which expects the cost of risk to fall from today’s levels.

The chamber notes that since the middle of the last decade, Greek banks have been able to improve their performance through effective cost-cutting measures and through the sale of non-core assets, resulting in cost-to-income ratios improved to almost 40% or less. “That makes them one of the most profitable banks in Europe.”

The bank’s profitability has improved after several years of loss accounting. “We expect profitability to improve further on the back of lower loan loss provisions, added value from higher borrowing rates and continued focus on controlling operating costs,” S&P said in a statement.

In addition, NPLs of Greek banks are expected to increase by 3-4%, mainly due to increased use of funds from European funds after a number of years of negative loan growth due to large sales of NDUs.