"In those other countries, though, senior bank executives were ousted and in some cases prosecuted for the lending decisions that helped topple their institutions. In Greece, by contrast, the government has not demanded board and management shake-ups at its rescued banks — with the exception of the National Bank of Greece, where top management was changed for political reasons when the new government took power last year. Big institutions and retail investors in Greece have also invested in the offering. But with the country still mired in a depression, such investors are relatively scarce. The potential beneficiaries appear largely to be bank insiders, whose personal wealth is often already tied up in the institutions. " " To some extent, Greek banks have been given the benefit of the doubt during the country’s bailout, on the assumption that it was the profligate borrowing and spending by Greece’s government that led to the country’s economic collapse. There is no doubt that when Greek government bonds became worthless and were restructured, the banks, which had loaded up on the bonds at the government’s urging, faced close to 40 billion euros in losses. But over time, some financial experts have reconsidered this view of Greek banks as mainly innocent bystanders. One such rethinking was detailed in a paper published in 2011 by Mwanza Nkusu, an economist at the I.M.F. "
Posted on: Wed, 26 Jun 2013 10:43:13 +0000
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