Embattled Greek banks were hit with more damaging data Friday
that showed savers withdrew funds at a rapid clip.
Deposits at Greek banks are at their lowest level in more than
10 years amid broad concerns about the country's economic prospects
that have hammered shares in Greek lenders this year.
Total deposits fell to €139.36 billion ($153 billion)
in April, down from €145.04 billion in March and over
€170 billion just five months ago, data from the European
Central Bank showed.
Shares in the country's biggest banks—National Bank of
Greece SA, Piraeus Bank SA, Eurobank Ergasias SA and Alpha Bank
AE—were mixed on Friday. So far in 2015, an index of
Greek bank stocks is down more than 27%, according to FactSet. By
comparison, the Stoxx Europe 600 subindex of European banking
stocks has risen more than 17% and Greece's benchmark stock index
is up around half a percent.
David Vickers, a senior portfolio manager at Russell
Investments, said that it would take a more significant outflow of
deposits to drive a steep downturn in bank shares.
"It looks like another 30% fall is deposits is needed before the
banks run out of collateral—I'm presuming the market
expects a deal to be done prior to that situation evolving," he
said.
The country's banks could be battered further if Greece doesn't
reach a financing deal with its international creditors in coming
weeks, economists say. But some high-profile investors have backed
Greek banks in recent months.
Hedge-fund manager John Paulson is still sanguine on Greece. In
mid-April, the American billionaire's Paulson & Co. Inc. held
132 million shares in Piraeus, according to Thomson Reuters, making
him one of the bank's top three shareholders.
The investment arm of Canada-based Fairfax Financial Holdings
Ltd. increased its stake in Eurobank to above 20% from just over
15%, the bank said in early April. Fairfax wasn't immediately
available to comment on whether it has bought or sold shares more
recently.
In a letter to shareholders in March, Fairfax Chairman and Chief
Executive Prem Watsa said, "while our total Greek investments are
below cost today, we expect them to do well over the long
term."
Wellington Management Group LLC, a Boston-based fund manager,
held 103.5 million shares in Piraeus, the bank said in March, a
holding that was worth around €50 million as of
Friday.
Separately, Wellington cut its Alpha Bank stake slightly, the
bank said in April, but it still held 208.6 million shares that are
currently worth around €70 million.
Wellington declined to comment on its holdings or whether it has
bought or sold shares since then.
Egon Vavrek, a senior emerging-market portfolio manager at APG
Asset Management, which as of the end of 2014 owned €61
million worth of shares in Greece's four biggest banks, said he
would consider increasing his exposure if substantial progress is
made on resolving the country's debt crisis.
Mr. Paulson said recently that it would be a mistake for Greece
to default. "It would be disastrous for Greece's economy and
citizens," he said.
"A default would be destabilizing to the European financial
system, but manageable," he added.
Paulson increased its stake in Alpha Bank to 208.4 million
shares, Alpha said in May last year, a holding worth more than
€140 million a year ago that now has a value of around
€70 million. Paulson & Co. declined to comment on any
of its Greek holdings.
Greece's government aims to have an agreement with its
international creditors by Sunday, but European officials warn that
the country is still far from offering sufficient economic
overhauls to unlock bailout funds.
Eleni Papoula, an analyst at Berenberg, said that while the
majority of investors "seem to be taking a wait-and-see approach
until a deal is confirmed" and ahead of major scheduled
debt-repayment deadlines over the coming weeks, "valuations make
the Greek bank stocks look very attractive to some."
Three of the four biggest Greek banks are trading higher on the
week. But strategists and investors warned that liquidity is
incredibly thin, accentuating any moves.
"Some days trading in Greek stocks and bonds is so thin that the
moves we see on the screen mean nothing," said Julian Jacobson, a
partner at privately owned investment manager FPP Asset Management
LLP. FPP has small holdings in Greek banks and has in the past
owned Greek sovereign bonds.
Write to Josie Cox at josie.cox@wsj.com and Rob Copeland at
rob.copeland@wsj.com
Access Investor Kit for London Stock Exchange Group Plc
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=GB00B0SWJX34
Access Investor Kit for National Bank of Greece SA
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=GRS003003019
Access Investor Kit for Piraeus Bank SA
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=GRS014003008
Access Investor Kit for Alpha Bank SA
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=GRS015013006
Access Investor Kit for Eurobank Ergasias SA
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=GRS323003004
Access Investor Kit for Alpha Bank SA
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US02071M1018
Access Investor Kit for Eurobank Ergasias SA
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US26844B2097
Access Investor Kit for National Bank of Greece SA
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US6336437057
Subscribe to WSJ: http://online.wsj.com?mod=djnwires