Despite the size of the problem, the capital base of the banking system – as mentioned above – remains strong, while in terms of provision coverage Greek banks are well placed compared to peers (50.1% vs. 46.1% EU average). If one adds to this the value of collateral pledged, total risk coverage comes to 101%, one of the highest in the EU.
Concluding, NPLs represent perhaps the most significant problem for the Greek banking sector along with liquidity (the two are of course interlinked).