Greek banks account for one-fifth of Albania’s banking system, but leaving the market will be difficult because of lack of potential buyers, experts say.
TIRANA, Aug. 20 – Greek banks that have branches in Southeast Europe, including Albania, would have to sell or close many of their branches according to the European Commission’s restructuring plans for Greek banks, the Greek newspaper Kathimerini wrote this week.
The plans for NBG and Piraeus Bank were approved in late-July, following those for Alpha in early-July and Eurobank in April, writes the Greek publication.
According to these plans, NBG will keep a presence in Turkey by retaining majority control of Finansbank, but will have to withdraw from all other countries in Southeast Europe. The bank will have to sell its subsidiaries in Albania, Bulgaria, Macedonia, Romania, Serbia, South Africa and the branches it operates in Egypt by June 2018, reports Ekathimerini.com.
The restructuring plan for Piraeus Bank provides for no more than 870 branches and some 15,300 employees by end-2017 and it also includes a drastic cutback in activities abroad.
The European Commission’s restructuring plans for Greek banks provide for a drastic scaling back of their activities abroad as well as reductions in the number of branches and staff at home.
The plans for banks National (NBG) and Piraeus were given the green light late last month, following those for Alpha in early July and Eurobank in April.
“Unless conditions change considerably in the coming years, it will be very unlikely to see the sale of our subsidiaries in the neighboring countries,” one source said, cited by Kathimerini.
Despite of their wish and joint agreement to leave business in the Western Balkan and Southeast Europe, the Greek banks currently face a difficult environment to withdraw as there is a lack in potential buyers.
The major banks operating in the region are still struggling to surmount the affects of the economic and financial crisis which is why investments are tight and any major acquisitions are not taken into account at the moment.
Greek banks account for one-fifth of Albania’s banking system.
NBG Bank Albania, a subsidiary of the National Bank of Greece, holds 3.3 percent of the total assets in the Albanian banking system. The two other Greek banks operating in Albania, the Tirana Bank part of Piraeus Bank and Alpha Bank Albania, part of Alpha Bank, hold 7.4 percent and 5.9 percent respectively, according to an IMF report.
The share of assets held by Greek bank in Albania has dropped from an estimated 25 percent in the pre-crises years to around 18 percent. The situation is also a result of the acquisition of Emporiki Bank from France-based Credit Agricole.
