Fitch Affirms B- Rating on Greek Systemic Banks, Outlook Stable
Fitch Ratings affirmed National Bank of Greece S.A. (NBG), Piraeus Bank, S.A. (Piraeus), Alpha Bank AE (Alpha) and Eurobank Ergasias S.A.'s long-term issuer default ratings (IDRs) at 'B-' with stable outlooks, Short-term IDRs at 'B', and Viability Ratings (VRs) at 'b-'.
The ratings agency also upgraded the senior debt ratings of the banks and their issuing vehicles to 'B-'/'RR4' from 'CCC'/'RR5' and subordinated debt rating to 'CC'/'RR6' from 'C'/'RR6', primarily reflecting lower balance-sheet encumbrance following restructuring including capital increases.
The banks' long-term IDRs, Fitch said, are driven by their intrinsic credit profiles, reflected in their VRs of 'b-'. The VRs are influenced by the challenging (albeit stabilising) operating environment in Greece (B-/Stable), which among other factors is characterised by high unemployment and weak domestic demand, in turn affecting negatively the banks' credit risk profiles.