Greece’s four major banks all posted substantial gains Friday, led by Piraeus Bank SA (OTCPK:BPIRF, Financial), which shot up 13.1%.
One of the most battered sectors of the European financial crisis, the banks each passed a critical stress test in April and look forward to the removal of bailout conditions in August. Alpha Bank (OTCPK:ALBKY, Financial) rose 4.4%, Eurobank Ergasias SA (OTCPK:EGFEF, Financial) gained 9.0% and National Bank of Greece (OTCPK:NBGIF, Financial) vaulted 4.1%.Ă‚
The broader Athens Stock Exchange General Index was up 2.77% for the day.
Each of the banks, except Piraeus, has lost more than 90% of its market cap in the past five years. Piraeus has declined by 48%.
Several Greek creditors and European officials are set to meet to discuss Greece’s debt at the G7 summit in Quebec, Canada on Saturday. Greece has showed some economic growth, with GDP rising for several consecutive years -0.3% in 2015 to a projected 2% for 2018, but the nation still owes 248 billion euros to the International Monetary Fund and the eurozone.
On Thursday, Greece’s fourth largest bank and best performer in the ECB’s stress test, Alpha Bank, reported a profit for the first quarter. The bank had 109.3 million euros in profit, an increase from its 86.8 million euro loss a year earlier, despite lower net interest income and higher cost of risk charges.
Non-performing loans increased to 35.2% from 34.9% from the fourth quarter. Group deposits grew to 35.9 billion euros, up by 2.8 billion from the same quarter the prior year.
“Following the successful Stress Test results, confidence in the banking sector is steadily improving, while economic recovery gradually gains momentum as the completion of the 3rd Economic Adjustment Programme in August 2018 paves the way for a gradual return to normality,” Alpha Bank CEO Demetrios Mantzounis said in a statement.
The National Bank of Greece also reported a profitable first quarter on Thursday. The group had 26 million euros in profit, an increase from a 9 million euro loss for the comparable quarter last year. It attributed the strength to lower cost of risk and said it expects to remain profitable for the remainder of 2018.
Its non-performing exposures declined to 42.7% from 43.7% at the end of last year, falling for the eighth consecutive quarter.
