Creditors of Greece from the eurozone imposed as a precondition for the new loan package from Athens adoption of the Directive of the European Union for the recovery and resolution of banks. This legislation facilitates the imposition of losses on senior creditors of troubled banks.
The financial analyst at British brokerage CRT Capital Ollie Barols however, states that the directive should be treated equally unsecured bondholders and depositors. “It is not clear how it will make it possible to use the bondholders in the rescue, while excluding deposits. However, as we have seen in other problematic situations where there is a will, you will find a way. Deyselblum decision represents only partial rescue,” he added.
Greek banks will initially have limited access to funds from the bailout before being approved recapitalization measures for them after a few months. Ten billion euros will be provided in order to restore confidence in Greek banks, but they will be transferred to a limited account. The funds will stay there at least until they complete stress tests, which are expected by the end of October.
After the initial recapitalization of the creditors, which will happen after the final signing of the agreement, banks will face closures of branches, mergers and possible sales of profitable subsidiaries abroad. This process, which affects the operations of banks in other countries have already started after it was announced that Postbank (owned by Eurobank) will acquire the business of Alpha bank in Bulgaria. While National Bank of Greece, which is owned by United Bulgarian Bank, prepares sale of part of its stake in its Turkish subsidiary Finansbank.