A further loosening of capital controls and an improvement in asset quality are credit positive for Greek banks, Moody’s announce on Monday, according to ANA.
In a report, the credit rating agency noted that “the improving economic outlook of Greece allowed a loosening of capital controls and possibly will strengthen a still weak confidence in banks, helping to attract more deposits, which is credit positive”.
A rise in deposits will help banks lower their dependence on the ELA mechanism, which totaled 21.6 billion euros at the end of December at a cost of around 1.5 pct, Moody’s said, adding that banks could see their capital cost falling by at least 120 basis points if they replace ELA with new deposits.
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