By L. Karageorgos
Bank of Greece (BoG) Gov. Yannis Stournaras and Greek shipping executives this week pointed to a reversal of previous years' trend in terms of remittances and shipping capital repatriated to Greece and the country's thrice-recapitalized banking sector.
Speaking at a reception hosted by the Union of Greek Shipowners this week, Stournaras said a significant drop in shipping remittances was recorded after capital controls were imposed in the country in late June 2015, with the flow of shipping capital expectedly diverted to foreign banks.
Nevertheless, he said the third recapitalization, along with a loosening of capital controls, especially in terms of imported capital, have quickly restored confidence in the domestic banking system.
Greek shipping executives said the trend will continue, if however, a series of steps are taken in the banking sector.
Stournaras also said credit extended to the shipping sector by Greek lenders fell by a whopping 10 billion euros in value over the last seven years, with outstanding loans now at 8.2 billion euros. The same figure in 2010 exceeded 18 billion euros, he said, while adding that the same downward trend appears throughout the European banking system.
The "slack" was covered by Asian banks via various credit schemes, Stournaras said.