GREECE Trends and Developments Contributed by: Panagiotis (Notis) Sardelas and Matina Kagkelari, Sardelas Petsa Law Firm
Sardelas Petsa Law Firm 8 Papadiamantopoulou Str. 115 28 Athens Greece
Tel: +30 210 72 96 550 Fax: +30 210 72 96 549 Email: office@sardelaslaw.gr Web: www.sardelaslaw.gr
Economic Backdrop: A Greece Transformed in 2026 In 2026, the Greek private credit market stands at a pivotal juncture. The market’s current trajectory is shaped by powerful macroeconomic tailwinds – sus - tained GDP growth, sovereign credit rating upgrades, and EU investment inflows – intersecting with critical legal and regulatory developments. Greece enters 2026 as a compelling story of resilience and recovery. The narrative of sovereign debt crisis has been replaced by stable growth, fiscal prudence and structural reform. These macroeconomic funda - mentals provide fertile ground for the expansion of private credit. This stability has been recognised by major credit rat - ing agencies (S&P, Moody’s, Fitch), which delivered a series of upgrades in late 2024 and 2025. Entering 2026, Greece is firmly in investment-grade territory, reducing the cost of sovereign borrowing and enhanc - ing overall investor confidence in the private sector. Against the challenging global backdrop of elevated interest rates, geopolitical volatility, and a gradual shift towards a European “war economy”, Greece nonethe - less offers a distinctive yield cushion: narrowing sov - ereign spreads, sustained GDP growth, and continued absorption of Recovery and Resilience Facility (RRF) funds position the market as a relative safe haven, despite broader international uncertainty.
The Banking Sector’s Structural Shift The health of the Greek systemic banks has improved markedly, with non-performing exposure (NPE) ratios reaching single digits. However, the legacy of the cri - sis and ongoing stringent prudential regulations (Basel III implementation) mean that banks remain inherently cautious lenders. They prioritise low-risk, collateral - ised large corporate lending and shy away from the bespoke, time-sensitive and occasionally complex financing needs of the dynamic Greek middle-mar - ket. This “financing gap” is not cyclical but structural, providing a durable mandate for private credit funds to operate. The Shift in Corporate Behaviour In 2026, mid-sized companies seeking capital for mergers and acquisitions (M&A), private equity buy - outs, recapitalisations or expansion projects are con - sidering private debt alongside – or in place of – bank financing. This shift is driven by the flexibility, speed and discretion offered by private lenders. While banks can take months to approve a complex loan, private funds can commit capital in weeks – a crucial advan - tage in competitive M&A scenarios. Furthermore, founder-owned businesses, prevalent in Greece, often prefer dealing with private lenders to secure capital without the stringent covenants or equity dilution associated with public markets or traditional bank debt. This creates a significant structural vacuum in financing for the crucial Greek middle-market – com - panies that are too large for simple microfinance but too small or too complex for traditional cautious bank lending. Private credit funds could fill this gap, offering
96 CHAMBERS.COM
Powered by FlippingBook