HFSF Divestment from Greek Banks Should Proceed Smoothly as Investment Flows Pick Up and Banks Are Stronger

The commentary focuses on the Hellenic Financial Stability Fund (HFSF) divestment process from the Greek systemic banks. Summary highlights from the commentary include:

-- Greece's business environment has improved and this has been attracting higher flows of investment lately. Greek banks have benefitted from the recovery in the domestic economy and are in a stronger position following significant restructuring.
-- The HFSF has played a key role in supporting the recovery of the Greek banking sector in the years following the global financial crisis and Greek sovereign debt crisis.
-- The HFSF is still one of the main shareholders of the large Greek banks, however, it aims to dispose of all its shares in the Greek systemic banks before 31 December 2025.

“We expect the HFSF divestment from the large Greek banks to proceed largely smoothly considering the sizeable improvements in banks' credit fundamentals as well as the resilience of Greece's economy, and the regained investor appetite for the country,” said Andrea Costanzo, Vice President from the DBRS Morningstar European Financial Institutions team. “The increased confidence in the Greek economy, together with the improved business environment and the stable political environment will be important during a period in which Greece needs to fulfil the targets and milestones of its Recovery and Resilience Plan (RRP) and attract much-needed foreign investments,” noted Spyridoula Tzima, Vice President, Global Sovereign at DBRS Morningstar.