The Bank of Greece published the executive summary of its Financial Stability Review, assessing that banking sector fundamentals improved overall in the first half of 2026 despite lower capital ratios and a marginal deterioration in asset quality. The review identifies geopolitical tensions, rising international energy prices, potential sharp asset repricing in international markets and the rapid development of frontier artificial intelligence models as risks to financial stability. Greek banking groups’ profits after tax and discontinued operations rose 3.8% from the first half of 2025 to EUR 2.6 billion. Core operating income, comprising net interest income and net fee and commission income, increased 8.3%, while lower income from financial transactions and higher operating costs weighed on results. The consolidated Common Equity Tier 1 ratio declined to 14.8% in June 2026 from 15.4% in December 2025, and the Total Capital Ratio fell to 19.6% from 19.8%. On a solo basis, the ratio of non-performing loans to total loans in Greece edged up to 3.4% from 3.3% over the same period. Banks should maintain their resilience and invest in digital transformation to manage emerging risks and potential shocks. The review also examines the complementary roles of the European Union’s Artificial Intelligence Act and the existing prudential supervision framework in overseeing financial entities’ use of artificial intelligence, including specific supervisory expectations.

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