ATHENS – As part of a consolidation that will close 180 branches on demand of international lenders, Greek banks will also fire 5,694 workers by the end of 2017.
The government is recapitalizing the banks with money from bailouts and as the institutions were pushed toward insolvency by losses incurred with their holdings in Greek bonds that were devalued 74 percent by a previous government.
The job cut and the branch shutdown will have been included in the revised restructuring plans that National, Alpha, Piraeus and Eurobank have submitted to the European Commission’s competition authorities which were required after the four lenders underwent their latest recapitalization process.
Greek banks have been wracked with a mountain of bad loans, including 250 million euros owed by the previous ruling coalition of New Democracy and PASOK who aren’t paying and aren’t being chased.
The banking sector is shrinking fast during a crushing economic crisis that has seen a series of scandals, including state banks officials said were used a conduits to funnel loans to privileged people who didn’t have to repay them.
The Hellenic Bank Association said that in 2009 Greece had 19 domestic banks, 36 foreign (mainly branches of major international lenders) and 16 cooperative banks.
Now there are just four major banks plus Attica Bank, HSBC and Panellinia and only five foreign banks with branches in Greece, and it seems like only three cooperative banks will survive, if they manage to collect the funds required for their recapitalization, Kathimerini said.