A successful National Bank (NBG) securitization of SME loans, expected to raise 300 million euros in medium-term funding, was cited as a “credit positive” event by Moody’s this week, part of a continuing improvement for the battered domestic banking sector.
“The deal is credit positive for NBG because it lowers NBG’s funding cost and provides an alternative funding source that will help the bank reduce its dependence on emergency liquidity assistance (ELA) from the Bank of Greece,” Moody’s stated on Thursday, adding:
“We consider this SME securitization to be a sign of increased confidence toward both NBG and Greek assets as collateral, paving the way for similar transactions with multilateral European entities that have a mandate to support Greece’s SME sector … However, given the deep challenges the market continues to face, we expect private investor interest for such deals to remain low until there is an ongoing improvement in Greece’s economy.”
