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Bank non-performing loans (NPL) in Greece represented over *** percent of the total gross loans in Greece in 2022. Non-performing loans are those that are in default or are close to being in default. Many standard contract terms specify that loans become non-performing after being in default for ** days, but this can vary. A steep increase in the share of non-performing loans in the Greek loan's portfolio took place from 2010 until 2017, when the ratio was approximately ** percent.

Other European countries

Although the non-performing loans in Greece have decreased a lot in recent years, some countries across Europe still had much lower NPL ratios. For example, the bank NPL to total gross loans ratio in the United Kingdom was approximately *** percent. Even at the height of the financial crisis, the UK had a relatively low NPL ratio. Similarly low ratio’s can be found in northern European countries like Norway or Lithuania. Even though Greece still has a higher NPL ratio, that difference has decreased a lot in recent years.

Coverage ratios

A non-performing loan coverage ratio looks at a bank's ability to absorb future losses. Banks understand that not every loan that they lend will be paid in full, so by predicting the rate of non-performing loans, banks can be prepared to cover these future losses. For example, China has a high provision coverage ratio, which means that its banks should generally be better prepared for such an outcome. In 2022, north European countries such as Lithuania and Iceland had some of the lowest coverage ratio in Europe.