The Financial Stability Report was posted today on the Bank of Greece’s website. It is issued twice a year by the Financial Stability Directorate.
The report reviews developments in the macroeconomic and financial environment, assesses risks and the resilience of the banking sector, insurance companies and other parts of the financial system, and analyzes the functioning of financial market infrastructures (payment systems, central securities depositories and central counterparties).
It focuses on developments in the banking sector in 2025 and also includes three Special Topics:
a) Special Topic I presents the assessment framework developed by the Bank of Greece for identifying and classifying systemic risks (“Systemic Risk Heatmap”) in the Greek financial system, aiming to map and monitor the evolution of vulnerabilities over time.
b) Special Topic II analyzes recent developments in the use of Distributed Ledger Technology (DLT) in financial markets.
c) Special Topic III presents the framework for managing risks from third-party Information and Communication Technology (ICT) service providers and its implementation in Greece under Regulation (EU) 2022/2554 (Digital Operational Resilience Act – DORA).
In 2025, Greek banking groups recorded post-tax profits from continuing and discontinued operations of €4.7 billion, up from €4.2 billion in 2024. This increase was driven by higher income from non-interest activities and reduced provisions for credit risk. Negative contributions came from lower income from financial transactions and higher operating expenses, mainly due to increased administrative costs.
The capital adequacy of Greek banking groups remained at a satisfactory level. Specifically, the Common Equity Tier 1 (CET1) ratio on a consolidated basis declined to 15.3% in December 2025 from 16% in December 2024, while the Total Capital Ratio (TCR) edged down to 19.7% from 19.8%.
The quality of loan portfolios improved. In December 2025, the ratio of non-performing loans (NPLs) to total loans stood at 3.3% (from 3.8% in December 2024), marking the lowest level since Greece joined the euro area and bringing it closer to the average of major banks in the Banking Union.
The outlook for the banking sector remains positive, as strong fundamentals help offset increased uncertainty and external risks. However, a prolonged conflict in the Middle East could negatively affect the financial position of businesses and households in Greece, as well as banks’ asset quality and their lending growth targets. Therefore, further strengthening of the financial system remains a priority, and continued vigilance from all stakeholders is required.
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