Banks’ profit challenges eased via ECB funding, Moody’s says

Greek banks will be able to face challenges to profitability from the coronavirus crisis with the help of increased funding from the European Central Bank, credit rating agency Moody's said in a credit outlook report on Thursday.
Moody's expects Greek banks' profitability to weaken as coronavirus-related market disruption shrinks quality lending opportunities and erodes fee and commission income, mainly due to fewer disbursements of new loans.
The ECB's move in April to accept Greek government bonds as eligible loan collateral, despite their "B1-stable" non-investment-grade rating, led to a steep rise in Greek banks' ECB borrowing, Moody's said.
Greek banks increased their ECB funding to 21.5 billion euros in April, around 8% of Greece's total banking assets, from €12.4 billion in March and €8.1 billion in December 2019.
The banks borrowed through the ECB's...