How much do Greek non-viable enterprises cost? Findings from an enterprise restructuring simulation exercise

The prolonged and deep economic recession has had an intense impact on the profitability of the Greek corporate sector, which in turn led to a steep increase in non-performing loans and consequently to the creation of a whole “generation” of non-viable or “zombie” firms. In the past, all the attempts to address the problem either from the Greek state or from the banking system have been timid or fragmented, resulting –in most cases – in generating vicious cycles of forbearance and “evergreening” which kept alive a substantial number of enterprises without any realistic hope of recovery.

As the conditions for more radical and long-term solutions to the problems of the domestic entrepreneurship seem to mature, at the same time there is a more urgent need to assess the potential benefit that can be gained for all stakeholders from a large-scale restructuring programme of Greek non-viable enterprises. This need is addressed in the present study by Piraeus Banks’ Chief Economist Ilias Lekkos and his research associate Evi Vlachou. Piraeus Bank’s research attempts to assess the potential benefits of restructuring non-viable enterprises.

Athens, 06 June 2018