Financial Stability Review: October 2026
22/10/2026 - Press Releases
- Risks to financial stability in Greece are associated with geopolitical tensions, rising international energy prices, a potential sharp repricing of assets in international markets, as well as the rapid development of frontier AI models.
- In the first half of 2026, the banking sector’s fundamentals remained on a positive trajectory, further increasing resilience to potential shocks.
The Executive Summary of the Financial Stability Review was posted today on the Bank of Greece website. The Review is published twice a year by the Financial Stability Directorate.
The Review examines developments in the macroeconomic and financial environment, assesses the risks to and the resilience of the banking and insurance sectors, as well as of the other sectors of the Greek financial system, and discusses the functioning of financial market infrastructures (i.e. payment systems, central securities depositories and central counterparties).
The present Financial Stability Review focuses on developments in the banking sector over the first half of 2026 and also includes two Special Features:
(a) Special Feature Ι presents the main points of the European Commission's Communication on the competitiveness of the banking sector published on 17 July 2026. The Communication describes the main challenges facing the existing European regulatory framework for credit institutions, analysing the key policy proposals for addressing them.
(b) Special Feature ΙΙ presents developments in the regulatory framework for artificial intelligence, with a focus on the two distinct, but complementary, pillars of supervision in Greece, i.e. Regulation (EU) 2024/1689 laying down harmonised rules on artificial intelligence, also known as the AI Act, and the existing prudential supervision framework, refined with specific supervisory expectations on the use of artificial intelligence by financial entities.
In the first half of 2026, Greek banking groups' profits after tax and discontinued operations amounted to EUR 2.6 billion, up by 3.8% compared with the first half of 2025. This was underpinned by core operating income (i.e. net interest income and net fee and commission income), which grew by 8.3% year-on-year. Lower income from financial transactions and higher operating costs had a negative contribution.
The capital adequacy of Greek banking groups remained at satisfactory levels. Specifically, the Common Equity Tier 1 (CET1) ratio on a consolidated basis declined to 14.8% in June 2026, from 15.4% in December 2025, while the Total Capital Ratio (TCR) fell marginally to 19.6%, from 19.8% in December 2025.
The asset quality of credit institutions deteriorated marginally. In June 2026, the ratio of non-performing loans (NPLs) to total loans in Greece on a solo basis stood at 3.4%, against 3.3% in December 2025.
The robust financial position of Greek banks allows them to continue supporting investment and sustainable economic growth through the extension of new credit. However, current challenges leave no room for complacency. Banks should maintain their resilience and invest in their digital transformation, so as to effectively manage emerging risks and potential shocks.
Link:
Executive Summary of the Financial Stability Review, October 2026