Marina Eliza Spaliara, Professor, Adam Smith Business School, University of Glasgow
Using the ECB Survey on the Access to Finance of Enterprises (SAFE), we examine how bank credit conditions shaped Greek firms’ access to finance during 2010–2025. Over the period of 2010-2018, firms in peripheral economies were more likely to have their bank loan applications rejected, and rejection probabilities were especially high for less creditworthy firms. Weak bank balance sheets appear to have amplified these effects, contributing to a prolonged credit squeeze in the corporate sector. As of end-March 2018, Greek banks’ non-performing loans (NPLs) were among the highest in the EU, at around 32.8% of total loans. Since then, NPLs fell to 3.8% in December 2024 and the year-on-year credit growth to non-financial corporations reached 17.2% in April 2025, the highest since early 2009.
This is especially relevant for Greece because the economy is dominated by small and medium-sized enterprises (SMEs), which rely predominantly on bank lending. SMEs represent 99.9% of businesses, generate around 67% of value added, and account for 84.6% of employment. Micro firms (0–9 employees) make up 94.7% of SMEs and employ roughly half of the workforce. Given the central role of SMEs and micro firms in Greece, a key question we address is how constrained access to bank finance shape firms’ real outcomes, including productivity, investment, and employment.
Meet our speaker and chair
Marina Eliza Spaliara is a Professor within the Adam Smith Business School at the University of Glasgow.
Professor Vassilis Monastiriotis is Director of the LSE Centre for Research on Contemporary Greece and Cyprus - Hellenic Observatory, Professor in Political Economy and Eleftherios Venizelos Chair of Contemporary Greek Studies at the European Institute, LSE.
The Hellenic Observatory (@HO_LSE) is internationally recognised as a leading research centre on contemporary Greece and Cyprus. In 2024, it became the LSE Centre for Research on Contemporary Greece and Cyprus with a strategy to expand its research base within LSE and beyond. The Centre produces world-leading, non-partisan research, critically engaging with key issues and fostering debate among academics, policymakers, and the public. Its work spans academic research, knowledge exchange, and policy impact.
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