Bank stocks revert to levels last seen during share capital increase

The completion of the second bailout review has led credit sector stocks to 12-month highs. The new agreement between Athens and its creditors has put banking stocks back on investors' radar screens as expectations that this could mean the crisis is bottoming out have strengthened.

Having suffered huge losses in recent years, as the recapitalizations sent old shares down to zero, bank stocks could be at the forefront of the market reaction should expectations for an economic recovery prove correct. The gains of the last few months effectively constitute the recovery of ground lost rather than real gains, as bank stocks remain more or less at the price levels during the last recapitalization of late 2015.

National Bank closed at 0.344 euros on Tuesday - i.e. above the 0.30-euro level of the share capital increase, and Alpha closed at 2.18 euros, against 2 euros upon...