Business confidence has soared after the election of a new centre-right government led by Kyriakos Mitsotakis
After more than a decade of struggle, Greek bankers are at last daring to believe that – this time – their country and financial sector has begun a recovery that lasts.
While the sector in Europe has struggled to recoup its 2018 losses, Greek bank shares have risen by about 50% this year. And to listen to the banks, this is just the beginning. After all, their shares still trade at a discount to book value of about 60%, compared with typical discounts of around 15% across Europe.
By the early 2020s, Greek banks think they will reach a similar rate of return on equity as their European peers, something approaching 10%.
Gradually, interest in the country and its banks is beginning to spread beyond the hedge fund community – and it’s no longer all about the risk Greece poses to the international economy.
“Investors feel we have turned a corner,” says the head of investor relations at one of the big four Greek banks.
