Greek banks rise from crisis with record profits and fewer bad loans
Greek banks have undergone a dramatic turnaround over the past decade. After suffering heavy losses and a surge in bad loans during the financial crisis, the sector has now stabilised. Recent reforms, strong profits, and a sharp drop in non-performing loans have put the industry on firmer ground.
Between 2010 and 2015, Greek banks faced severe challenges. Non-performing loans (NPLs) soared to nearly 50% of their total loan books. The crisis also saw deposits cut in half and multi-billion losses after a 'haircut' on government bonds.
In response, the Greek government bailed out the four major banks with 50 billion euros of public funds. By 2019, authorities introduced a secondary market for bad loans and an asset protection scheme. These measures allowed banks to securitise and sell around 57 billion euros of non-performing loans.
The reforms worked. By 2024, the ratio of non-performing exposures (NPEs) fell below 4%, close to the European average. Macroeconomic stability improved liquidity, boosted profits, and strengthened capital reserves. The four biggest banks reported nearly 5 billion euros in net earnings for 2025 alone.
With their balance sheets repaired, Greek banks have resumed lending. Loans to businesses and mortgage lending have risen significantly. This shift has helped support household spending and business investment, aiding the country's broader recovery.
The government completed the privatisation of the four major banks in 2024, marking the end of state ownership. With healthier finances and stronger lending activity, the sector now plays a key role in Greece's economic rebound. The drop in bad loans and rise in profits reflect a banking system that has moved beyond its crisis-era struggles.
