GIG Economic Bulletin – March 21, 2022

Greece is now just one step short of investment grade on the DBRS ratings scale, with the latest upgrade report citing progress on reforms and fiscal discipline. Annual results released by the systemic banks confirm they are in the final stretch of their balance sheet clean-up efforts.

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An upgrade of Greece’s credit rating by DBRS Morningstar on Friday has moved the country a notch away from “junk” status and into investment grade, while Greece’s systemic banks reveal progress in the reduction of their NPE stock in latest annual results. Steps are being taken by Athens to boost energy security including the acceleration of offshore natural gas exploration and new energy infrastructure projects.


Ratings agency DBRS moved Greek debt one step closer to investment grade by upgrading it from BB to BB (high), citing progress on economic reforms and commitment to fiscal adjustment. Finance Minister Christos Staikouras said the development created a clear and realistic path to attaining investment grade in 2023.

The government announced a €1.1-billion package to cushion the impact of inflation on households and businesses. The package covers the next three months and comes on top of the €2.6 billion already allocated to subsidise energy bills. It will be financed by the state budget and the Energy Transition Fund.

The revised budget for 2022 will be released in April, when the Finance Ministry is due to publish the latest Medium Term Fiscal Strategy. The baseline scenario is 3.5-4% growth with average inflation of 5-7%.

The Parliamentary Budget Office is predicting average inflation ranging between 7.4-11%, compared to its projection of just under 7% prior to the war in Ukraine, while growth expectations are trimmed to 2.2-2.75% from 3.6%.

Seasonally adjusted unemployment in January held at the December 2021 level of 12.8%, according to the Hellenic Statistical Authority (ELSTAT), compared to 16.2% recorded in January 2021.

Company sales totalled €20.8 billion in January, marking a 30% Y-o-Y increase which largely reflects the relaxation of lockdown measures.


The Finance Ministry has published the list of 70 projects with a total budget of €2.4 billion which have been approved for RRF funding. They include 37 private sector projects worth €932 million.


The IGB gas pipeline connecting Greece and Bulgaria will be officially inaugurated on Friday by the two governments. The pipeline will become fully operational by late summer and will initially ship gas from Azerbaijan to Bulgaria.

The management company of the TAP pipeline has stressed the potential for a doubling of the pipeline’s initial capacity from 10 bcm to 20 bcm annually over a period of 45-65 months.

The South Kavala underground gas storage facility made it into the latest round of Projects of Common Interest (PCIs) adopted by the European Parliament, opening the route to EU co-funding. The deadline for public consultation on the project has been extended until the end of March.

A senior U.S. Department of Energy official has hinted that recent developments may prompt the U.S. to re-examine its stance on the EastMed pipeline, which had recently been deemed unviable on economic and geopolitical grounds.

The 3+1 group of Greece-Cyprus-Israel and the U.S., initially formed around the EastMed gas pipeline proposal, are also focussing on an electrical interconnector according to reports of high-level talks in Washington.

The government is said to have given the go-ahead to Hellenic Hydrocarbon Resources Management to accelerate offshore exploration in the Ionian Sea and Crete plots which have been licensed to HELPE and Total-ExxonMobil-HELPE respectively.

Over €4 billion will be made available from the EU’s Social Climate Fund for energy efficiency upgrades of buildings, renewable energy and electric vehicles between 2025-2032, making Greece one of the top five beneficiaries of the fund.

Prime Minister Kyriakos Mitsotakis has proposed to the European Commission the creation of a research centre focussing on alternative fuels for the shipping sector in Greece.


Traffic at Greece’s regional airports reached 63.4% of 2019 levels in the first two months of 2022 according to Fraport Greece. Traffic at Athens International Airport reached 59% of 2019 for the same period.

Greek ports recorded a 34.4% increase in passenger traffic in Q3 2021 according to ELSTAT. Vehicle traffic was up by 78.8%.


The deadline for binding offers on LARCO has been extended from March 14 to March 31, as the special administrator wraps up the redundancies of 1,060 workers.


The Piraeus Port Authority (PPA) reported a 16% increase in turnover in 2021, reaching €154.2 million. Profits after taxes were up 39.4% to €26.4 million. Container traffic was up by 13.9% and car traffic increased by 40.6%.

The Council of State has put PPA’s Master Plan on hold for the Piraeus Port redevelopment on the grounds that the original license was issued without a comprehensive environmental impact report.

Piraeus Port. Copyright: Aerial-motion /

Real Estate

Around €150 million of investment are estimated to be in the pipeline in the warehouse and logistics sector up to 2023 according to industry sources. Prices for logistics facilities have seen a 10% increase in the past year according to a report by Geoaxis. The increase is seen in both rental and sale prices, with rental yields ranging between 7-7.5%.


Alpha Bank reported profits after taxes of €330 million for 2021, while the bank incurred net losses of €2.9 billion from balance sheet clean-up activities which brought the NPE ratio down to 13%. The bank reaffirmed its goal of reducing NPEs from €5.1 billion at the end of 2021 to €1.1 billion in 2024, and to distribute dividends for the 2023 fiscal year, which is based on a capital adequacy assumption of 13.5% and a return on equity of 10%.

Piraeus Bank reported a loss of €3 billion in 2021, on the back of increased balance sheet clean-up activity that saw NPEs reduced by €16.8 billion to €4.9 billion. Pre-provision income was up by 4% to €902 million in 2021.

NBG announced profits after taxes of €833 million, a rise of 41% annually. The significant progress in cleaning up the balance sheet is now evident in the low provisions, as NPEs dropped to €2.1 billion, bringing the ratio down to 6.9%.

Four bidders have submitted binding offers for the €5.2-billion Ariadne NPE portfolio, with two reportedly exceeding the minimum valuation. The mega-consortium of Bain-Fortress-Davidson Kempner-doValue-Cepal is up against Intrum-Cerberus, Lone Star and Ellington.

Loans managed by servicers increased by €7.5 billion in Q4 2021, bringing the total to €79.2 billion according to the Bank of Greece.

Stock Market

The ASE general index rebounded strongly to close Friday at 862.86 points, with weekly gains of 4.21%. Capitalisation increased by €2.07 billion to reach 62.5 billion euros.

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