Restrictive criteria of a new law on banks’ corporate governance framework imposed an one-dimensional management scheme to Greek banks, with board members having a limited and restricted field of knowledge and expertise, Luca Katseli, president of National Bank said on Thursday.
Addressing an annual general shareholders’ meeting, Katseli said that adoption of such a model would raise very serious risks to an efficient implementation of challenges faced by Greek banks and undermined their competitive position in a competitive international banking sector.
A successful international practice, followed by all advanced countries and adopted by all large banking groups around the world, has become prohibitive for the country’s banking sector, Katseli said, adding that a new corporate governance framework rightly promoted and upgraded banking skills that a board should have and independence from the political system but at the same time it cut the necessary connection to the real economy and deprived the fully needed skills and expertise that a board has to have as a collective body to cope with new challenges.
National Bank’s head said that the Greek economy showed mixed signs in the first months of 2016 with positive outlook, if a clime of economic and political stability was to be strengthened. “Within an unstable European environment, an expected stabilization of the Greek economy and of the political environment, the first positive signs of recovery makes us cautiously optimistic. If there were no new unexpected developments, if agreed measures were implemented fully with corrections where necessary and if fiscal and structural measures were included in a credible medium-term programme of productive restructuring, then we could look forward to a gradual but stable improvement of business and investment climate, of purchasing power and confidence in the economy and the banking system,” she said.
Commenting on National Bank, Katseli said that challenges were many and urgent. National Bank’s basic strategic goals were to recover and expand its profitability, to maintain its leading role in the country’s financial system and to play a leading role in the restart of economic activity in the country. The course towards sustainable profitability needs efficient and fast response to a series of challenges, such as the management of non-performing loans.
Leonidas Fragiadakis, chief executive in National Bank, in his address said the bank aimed at further improving its operating profitability, upgrading the quality of its loan portfolio and supporting the Greek economy in exiting a recession. He added that a fair resolution of the non-performing loans issue was an one-way road and stressed that National Bank saw this as an opportunity.
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