Bad loans hit Piraeus and Alpha Bank again

The banks, which have been largely cut off from tapping the European Central Bank’s main funding operations, survive on a drip feed of emergency liquidity from the domestic central bank.

Piraeus Bank, Greece’s second-largest lender by assets, made a fourth-quarter loss of 332 million euros after taking bad loan provisions of 519 million euros.

However, that was a smaller than the third quarter when a 2.24 billion euro charge for bad loans pushed it to a loss of 1.56 billion euros.

Alpha, Greece’s No. 4 lender, posted a net loss of 440.2 million euros, bigger than a 156.9 million euros loss in the third quarter as loan-loss provisions more than doubled to 772.6 million euros.

Deposits fell 5.6 billion euros in the first two months of the year as Greece sank into a new crisis, the bank’s CFO Vassilis Psaltis told Reuters. With the latest political crisis worsening the outlook, bad loans are now expected to peak in the first quarter of 2016 instead of this quarter, he said.

Alpha, which is about 66% owned by the country’s bank rescue fund HFSF, said emergency liquidity funding from the central bank was 17.6 billion euros at the end of February.

Piraeus also cited deposits falling by 6.9 billion euros in the first two months of the year. It said bad loans dropped slightly to 38.8% of its book from 39% in the third quarter.


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