Greek banks are experiencing a remarkable surge in credit expansion, with an estimated 8% growth rate in 2026, according to the latest data. This positive trend is expected to continue, with projections indicating a potential increase of €10-12 billion in net credit expansion by the end of the year. This growth is particularly significant, as it represents one of the highest performances in the last 15 years, showcasing the resilience and potential of the Greek banking sector.
The driving force behind this credit expansion is twofold. Firstly, the disbursements of the Recovery and Resilience Fund (RRF) resources are fueling large and medium-sized investment projects, providing a much-needed boost to the economy. Secondly, the Hellenic Development Bank (HDB) is leveraging €2 billion from the RRF's unused resources to support small and medium-sized enterprises (SMEs), which is expected to have a significant impact on the growth of these businesses.
This momentum is further supported by an analysis conducted by Axia-Alpha Finance, which predicts that loans will grow at an average annual rate of around 8% in the 2026-2028 period, making it one of the three highest in the eurozone. This growth is not temporary, as the Greek economy is still in the phase of restarting bank lending after many years of deleveraging during the financial crisis.
The pipeline of projects remains strong, particularly in the tourism, energy, and shipping sectors, with no decrease in the demand for loans observed. Businesses are increasing investments and financing new projects, covering the large investment gap of the previous decade. This is a positive sign for the Greek economy, as it indicates a strong and growing demand for credit.
The credit expansion for 2026 and 2027 is expected to be supported by large and medium-sized investment projects that were left out of the RRF, with a total budget of €9 billion. These projects will be financed through conventional bank lending or other financing tools, providing a safety net for mature investment projects that did not secure a place in the fund, mainly from the pool of SMEs.
In conclusion, the Greek banking sector is experiencing a significant surge in credit expansion, driven by the disbursements of the RRF resources and the support from the HDB. This growth is expected to continue, providing a much-needed boost to the economy and supporting the growth of businesses, particularly SMEs. The positive trend is a sign of the resilience and potential of the Greek economy, and it is likely to have a lasting impact on the country's economic development.
