National Bank of Greece SA (NYSE:NBG) and four other Greek banks had the credit rating cut by Fitch Ratings, as concerns continue on the sovereign debt issue and how it will be handled.
The major reasoning according to Fitch behind lowering the credit ratings of the Greek banks was liquidity and funding, particulary the ability to remain liquid under their current market conditions.
As far as Greece itself, Fitch also lowered their credit to as low an investment grade as they go, and the outlook going forward is negative for the country.
The largest bank in Greece, the National Bank of Greece, had its rating dropped to BBB-, which is the lowest there is in investment-grade ratings.
Fitch says the Greek government seems to have the desire to support the banks, but the ability to do so isn't there, which was part of the downgrade decision as well. Only external aid will help Greece and the banks, which in fact does make them extremely suspect and subject to others outside of themselves.
Deposits have had dramatic decreases as well, with a drop of 2 to 4 percent in the last three months, and no end in site as to its continuation.
While European Union representatives have reaffirmed they're ready to rescue Greece if need be, it doesn't deal with the extraordinary irresponsibility and economic outlook inherent in its people, who seem to think everyone owes them a cushy lifestyle while they make little effort to provide for themselves.
Any rescue which doesn't deal with the core issues won't help at all, as shown by the so-called outrage of those in Greece who don't want to be stopped being taken care of by the government, even in the face of this economic disaster brought on by that very attitude and lifestyle.
For the Greek National Bank, they will continue to struggle to survive in the midst of this atmosphere, and until a rescue comes they will continue to flounder under the wait of circumstances now beyond their control.
No comments:
Post a Comment