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Piraeus Bank optimistic about stress tests

Jessica Morris, Special to CNBC.com
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'Optimistic' on ECB stress tests: Piraeus Bank CEO
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'Optimistic' on ECB stress tests: Piraeus Bank CEO

The CEO of Piraeus Bank has told CNBC that he is optimistic about the results of the European Central Bank's (ECB) review into the balance sheets of the euro zone's largest banks.

The results of the ECB's Asset Quality Review (AQR) – designed to determine how well banks would cope with future market shocks - are expected to be published on October 26.

"No banking system has gone through as much scrutiny as the Greek banks. This is the third test in a row," Anthimos Thomopoulos, CEO of one of Greece's largest banks, told CNBC in a television interview. "I am calculating buffers at the tune of 6 or 7 billion euros ($7.6 or $8.9 billion) based on the base case, so that should be sufficient to absorb any result of the upcoming AQR".

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Piraeus Bank has already raised around 1.75 billion euros in fresh capital to meet the financial stability requirements of its own central bank and Troika of international lenders. Additionally, its 500-million-euro bond offering earlier this year was oversubscribed.

Read MoreECB gets tough onrisky bank assets

Once the AQR is out of the way, Greek banks will be able to return their focus to the country's recovery, according to Thomopoulos.

"Hopefully it will dispel any concerns about the capital and the strength of Greek banks," he added. "That will of course allow us to turn our focus on the real economy and do more to support the recovery in Greece."

The Greek economy is expected to grow around 0.6 percent this year, according to the European Commission, but it follows a contraction of close to 4 percent last year.

Despite growth forecasts, however, the country still faces a number of headwinds, and its stubbornly high unemployment rate of 26.7 percent causing particular concern.

NPLs 'coming back to life'

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Non-performing loans (NPLS) - which have been in arrears for more than 90 days – are currently at 38.5 percent for Piraeus Bank, but have "diminished a lot over the the course of the last year and a half," Thomopoulos said.

"It's now flattening out and soon we're going to see NPLs coming back to life, as opposed to further delinquencies," he added.

It's a different picture to that of 2013, when Thomopoulos had told CNBC that Greek NPLs were still rising, and the situation was "ugly."

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