The Bank of China (BOC) recently received approval from Greece's central bank to establish its first branch in the country's capital, Athens. With the launch of its first branch in Greece, an event that was attended by Chinese President Xi Jinping, one of China's largest lenders is reportedly setting its eyes on further expansion in the country's banking sector.
The BOC branch in Greece is going to be part of the bank's rapidly growing international network. The bank currently has branches in over 59 countries and regions around the world. With the approval it had received from the Bank of Greece, the BOC is now laying out plans for its strategic entry into the European nation and the European Union as a whole.
According to the BOC, its presence in one of the members of the European Union and the China-Central and Eastern European Counties (CEECs) is necessary given the stronger partnerships that have been formed in recent years. Greece previously signed a memorandum of understanding with China over stronger cooperation in the latter's Belt and Road Initiative.
Establishing a branch in Athens is both a practical and strategic decision for the BOC for it to more closely support the Belt and Road Initiative projects in the region. Apart from standard banking services such as deposits, remittances, and loans, the BOC's branch in Athens will be providing expanded services such as trade financing and international settlements. These services are meant to provide support for the economic and trade exchanges between both nations.
Following the BOC's announcement of the establishment of a branch in Athens, Chinese officials have expressed interest in finding new financial opportunities in the European nation. These opportunities could include possible mergers and acquisitions with Greek banks who are dealing with bad loans.
The four major banks in Greece are currently dealing with billions of dollars worth of non-performing loans. These loans were from customers who previously had to endure an almost decade-long economic crisis, with most essentially not able to pay their mortgages, loans, and credit cards.
Reports of China's alleged interest in acquiring some of Greece's bad loans reportedly originated from a working lunch meeting between the Greek Deputy Finance Minister George Zavvos and BOC officials, including BOC President Liu Liange and General Manager Zhou Lihong. Bank executives reportedly asked Greek officials about their plans for the country's existing bad loads. However, the officials reportedly did not explicitly mention that they have plans to acquire bad loans.
