ESF: ‘Green light’ to Greek banks for the first dividend distribution since 2008

With the blessings of the European Central Bank ( ) and the Single Supervisory Mechanism (SSM) it is expected to be made from the first dividend distribution to shareholders since 2008, according to Bloomberg sources. The dividend approved by the ECB, however, will not be equal to what the Greek banks planned, while the American instrument stresses that decisions are not definitive. The last time a large Greek bank paid a dividend was in 2008, before the global financial crisis and shortly before the country’s debt crisis began in 2010. Since then, banks have been recapitalised under Greece’s rescue programmes, since their balance sheets have been weakened. Bloomberg’s information says that the ECB is expected to allow distributions since the Greek banks are on a good course to reduce unperforming loans and increase their financial power, while the economy gradually returns to normality, recovering their investment level last year. The four systemic banks have already agreed on their plans to pay a dividend this year, pending the relevant approvals by the authorities. The supervisory authority continues to assess how bank capital levels will evolve, according to Bloomberg, while the ECB is considering the role that deferred tax credits play in the past in the capital reserves of Greek banks, as well as the prospects for their profits if interest rates are reduced this year.