Greek bank Eurobank is to provide £670 million in funding support to Greek tourism and hotels.
The investment is viewed as central to combat a deep recession predicted by the European Commission that estimate Greece’s economy will contract by 10% in 2020.
Eurobank has now pledged to make a 750 million euro (671 million pounds) funding package available to help Greek hotels and tourism bounce back from the Covid-19 crisis.
Eurobank is Greece’s third-largest lender and has stated it will offer hotels more than 250 million euros of immediate liquidity to help cover their working capital needs this year.
Further support will see repayments of loan principal suspended until the end of next year for borrowers with loans which were performing up to the end of 2019.
Tourism in Greece employs one in five of the Greek population and as such is a vital part of the Greek economy.
Leading banks in Greece including Eurobank have been working to reduce a pile of about 75 billion euros in bad loans. These legacy loans were a hangover from the 2008/9 debt crisis that saw Greece’s economy reduce 25%.
A spokesperson for one of the banks said that he expected the impact from the Covid-19 crisis to be less than the 2008/9 debt crisis. Optimistic in our view but let’s hope he’s right.