The European Central Bank published a blog post taking stock of Greece’s path from crisis to recovery, with a focus on whether the banking system can sustainably finance the real economy and what is still holding back convergence in living standards. It concludes that banks have largely restored their intermediation capacity, but that crisis legacies persist, notably the slow resolution of non-performing exposures that have moved outside banks and broader structural constraints on productivity and participation. Greek banks rebuilt capital and cleaned up balance sheets, supported by strengthened supervision and the Hellenic Asset Protection Scheme, which helped securitise and sell around EUR 57 billion of non-performing loans by 2025. Lending to non-financial corporations has risen, mortgage lending is recovering, and evidence from AnaCredit suggests credit access for micro firms improved in 2024 compared with 2019, although micro and small firms still face constraints. By end-2024 most non-performing loans had shifted to foreign funds under the scheme and are managed by credit servicing companies, with the assets involved equivalent to about one-third of GDP; progress in addressing this stock has been slowed by gaps in the auction system, court backlogs and information issues, while state guarantees on securitisations create a contingent fiscal liability. On the wider economy, exports now exceed 35% of GDP (from around 21% before the crisis) and estimated trade barriers with EU partners have fallen faster since 2015, but the post notes that institutional quality weaknesses and still-high public debt remain challenges, with programme-related repayments to EU official creditors ongoing and the remaining stock around 90% of GDP in 2025.
European Central Bank 2026-03-21
European Central Bank blog reviews Greece’s recovery and highlights unresolved distressed debt outside the banking system
The European Central Bank reviewed Greece's recovery, noting banks have restored intermediation capacity but face persistent crisis legacies, including unresolved non-performing exposures and structural constraints. Greek banks improved capital and balance sheets, aided by the Hellenic Asset Protection Scheme, which securitised EUR 57 billion in non-performing loans by 2025. Despite increased lending and export growth, challenges remain with institutional quality, high public debt, and contingent fiscal liabilities.