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The outlook was adjusted due to expectations of improvements in performance and funding of the country's financial organization, in spite of bad loans and limited opportunities for lending.
"We expect that Greek banks will return to small profit in 2016-17 years thanks to substantially lower deductions for losses on loans, decreased funding costs and limits on operating expenses," - noted Moody's.
The agency warned that despite of resumption of the banks’ access to the interbank repo market, the financial organizations will continue to be heavily dependent on funding from the Central Bank of Greece in the foreseeable future.
According to Moody's forecast, the Greek economy will avoid reduction in 2016. As for 2017, the agency expects that the country’s GDP growth will rise to 1.8%.
Recapitalization, which took place in Greece with participation of private sector, can be an example for other countries, said President of the Eurogroup Jeroen Dijsselbloem. He said this at UBS Bank in London.
"Threat of conversion forced banks to increase their reserves by attracting private capital, issuance of securities, mergers with other banks. In Greece, for example, threat of conversion in the last year significantly increased private capital in recapitalization of some Greek banks, thereby weakening public debt burden," - he said.
Earlier, Chief of the country’s Central Bank Yannis Stournaras assured the public that "the Greek banks will not suffer from turmoil in European banks." He, of course, was referring to Deutsche Bank’s problem of.
Stournaras added that Greece now has all tools that "did not exist in the past" to deal with difficult situations. However, he may have forgotten that capital control is still valid in Greece, and all Greek banks are now considered to be insolvent, since they are feeding solely through provision of liquidity by the ECB.
Greece's economy has grown in the III quarter of 2016 by 1.5% in annual terms, after declining by 0.6% in the previous 3 months, according to preliminary data of the Greek Statistical Office.
In quarterly terms, the increase amounted to 0.5% against expected decline of 0.2%. The growth rate over the past two quarters was recorded for the first time since 2013. Revised figures will be released on 29 November.
The European Commission and the Central Bank of Greece expected the country’s GDP to reduce by 0.3% in the current year.
Budget for 2017 assumes GDP growth by 2.7% compared with a decrease of 0.3% in 2016. Private consumption will grow by 1.8%, while government consumption will decrease by 0.3%. Total consolidated government debt in 2017 will be 319.2 billion euros (176.5% of GDP), compared with 315.4 billion (180.3% of GDP) in 2016 and 311.673 billion euros (177.4% of GDP) in 2015.
In monetary terms, GDP will amount to 180.817 billion euros in 2017. In 2015, GDP amounted to 175.697 billion euros, and is expected to shrink to 174.908 billion euros this year.
As for revenues, net revenues are planned in the amount of 54.529 billion euros, of which 20.415 billion euros will be collected in the form of direct taxes, and 26.433 – of indirect taxes.
source: reuters.com
"We expect that Greek banks will return to small profit in 2016-17 years thanks to substantially lower deductions for losses on loans, decreased funding costs and limits on operating expenses," - noted Moody's.
The agency warned that despite of resumption of the banks’ access to the interbank repo market, the financial organizations will continue to be heavily dependent on funding from the Central Bank of Greece in the foreseeable future.
According to Moody's forecast, the Greek economy will avoid reduction in 2016. As for 2017, the agency expects that the country’s GDP growth will rise to 1.8%.
Recapitalization, which took place in Greece with participation of private sector, can be an example for other countries, said President of the Eurogroup Jeroen Dijsselbloem. He said this at UBS Bank in London.
"Threat of conversion forced banks to increase their reserves by attracting private capital, issuance of securities, mergers with other banks. In Greece, for example, threat of conversion in the last year significantly increased private capital in recapitalization of some Greek banks, thereby weakening public debt burden," - he said.
Earlier, Chief of the country’s Central Bank Yannis Stournaras assured the public that "the Greek banks will not suffer from turmoil in European banks." He, of course, was referring to Deutsche Bank’s problem of.
Stournaras added that Greece now has all tools that "did not exist in the past" to deal with difficult situations. However, he may have forgotten that capital control is still valid in Greece, and all Greek banks are now considered to be insolvent, since they are feeding solely through provision of liquidity by the ECB.
Greece's economy has grown in the III quarter of 2016 by 1.5% in annual terms, after declining by 0.6% in the previous 3 months, according to preliminary data of the Greek Statistical Office.
In quarterly terms, the increase amounted to 0.5% against expected decline of 0.2%. The growth rate over the past two quarters was recorded for the first time since 2013. Revised figures will be released on 29 November.
The European Commission and the Central Bank of Greece expected the country’s GDP to reduce by 0.3% in the current year.
Budget for 2017 assumes GDP growth by 2.7% compared with a decrease of 0.3% in 2016. Private consumption will grow by 1.8%, while government consumption will decrease by 0.3%. Total consolidated government debt in 2017 will be 319.2 billion euros (176.5% of GDP), compared with 315.4 billion (180.3% of GDP) in 2016 and 311.673 billion euros (177.4% of GDP) in 2015.
In monetary terms, GDP will amount to 180.817 billion euros in 2017. In 2015, GDP amounted to 175.697 billion euros, and is expected to shrink to 174.908 billion euros this year.
As for revenues, net revenues are planned in the amount of 54.529 billion euros, of which 20.415 billion euros will be collected in the form of direct taxes, and 26.433 – of indirect taxes.
source: reuters.com
