Fitch trigger sales on Athens Stock Exchange, which at the beginning of the afternoon came to lose more than 10 percentage points. The American rating agency released today a report that launches the alarm on the soundness of Greek banks in view of the results of the ECB's stress tests. Despite the improvements, according to Fitch, institutions would still be weighed down "by heavy problems on loan portfolios".
The agency believes that the stress tests on EU banks that the European authorities will make public on October 26 "could reveal other capital shortages in Greece, especially if the planned restructuring measures are not fully implemented". Fitch then notes that the share of non-performing loans ranges from 29,7% of the National Bank of Greece to as much as 45,6% of Alfa Bank, based on data relating to the end of 2013.
The sales on the main Greek listing mainly hit the financial sector, as a reflection of the surge in government bond yields. The Greek bond rate at 10 years it shot up to 7,82%, bringing it spread with the German Bund soaring from 600 to 703 points.
The differential also widened because investors on the fixed-income market headed for the German Bund, which records a yield at a new all-time low, below 0,80%.
On the other hand, the ten-year rates of Italy and Spain, respectively 2,37% and 2,08%, with spreads at 164 and 134 basis points.
