Greek lenders can handle new cap on bank transfer fees

New regulations in Greece that will reduce the cost of bank transfers are expected to have a manageable impact on the country's lenders.

As part of legislation that balances societal benefits with economic fairness, a 50-euro-cent cap will be placed on all bank transfers up to €5,000. Other initiatives include zero charges for paying bills and debts, higher transaction limits via the direct payment system IRIS, and zero fees for loading prepaid cards.

The new laws are projected to result in a 1.5% decrease in posttax profit in the Greek banking sector, according to Eleni Ismailou, vice president of the research division at Axia Ventures Group.

"Greek banks are expected to continue growing their loan books, as well as their asset management and bancassurance business lines, which will drive net fee and commission income growth in the coming periods," said Ismailou.

The new policy is expected to be implemented later in January. The country's four largest lenders — Eurobank Ergasias Services and Holdings SA, Piraeus Financial Holdings SA, Alpha Bank SA and National Bank of Greece SA — did not respond to requests for comments.

Recent earnings results reinforced confidence in the Greek banking sector's outlook for the near future. In the third quarter of 2024, Greek banks made further asset quality improvements, and the country's largest lenders all reported lower stage 2 and stage 3 loan exposures compared with the previous year.

Greece's real GDP growth for 2023 was 1.99% and is expected to remain nearly stable through 2030, according to S&P Global Capital IQ data.