National Bank of Greece (ADR) (NYSE:NBG) Falls Prey To Greece’s Political Unrest

National Bank of Greece (ADR) (NYSE:NBG) remains vulnerable to what goes in its home country, Greece. The shares of the bank tanked by as much as 9.09% to end at $1.80. The decline is in response to broader market fall in Greek equities that are down by nearly 20% following the political crisis ahead of the impending elections.

Analyst help identify trailing stop-losses for both long and short position in NBG.

Announcement Of Presidential Elections

The fall in shares of National Bank of Greece (ADR) (NYSE:NBG) went in line with the steep fall in shares of other banks listed on the U.S. stock exchange. Those include, PIRAEUS BANK SA (OTCMKTS:BPIRY) and Global X Funds (NYSEARCA:GREK), which went down by 9.80% and 9.16% respectively. The political unrest emerged after Prime Minister, Antonis Samara, announced the presidential elections next week on December 17, 2014.

The announced date is two months earlier than the earlier schedule. The electors are nervous as snap parliamentary elections are possible if Samaras’ party candidate Stavros Dimas fails to win the election. Dimas will need 180 votes out of 300 Greece’s parliamentary votes in order to win the election. The most probable date for the general elections, if Parliament is dissolved, will be January 25 to February 1.

High Uncertainty

Further, the weakness in the Greek banking stocks comes as Syriza Party is showing strength. It is to be noted that Syriza is a strong promoter of nationalized banks and does not support for Greece’s European bailout agreements. If it comes to power then, the situation might become unfriendly for Greece’s biggest private banks. Wolfango Piccoli, an analyst at Teneo Intelligence wrote that the outcome will be “highly uncertain” till “the very last minute.”

The uncertainty of things drove the Athens Stock Exchange down by 8%, which is just two days lates to exchange’s severe fall since 1987. There is little hope if shares of National Bank of Greece (ADR) (NYSE:NBG) could recover till the election results are out.



The state of National Bank of Greece (ADR) (NYSE:NBG) can be best described from the fact that the stock used to trade at $600-$700 in 2007 and currently trades near $2. It has been a vicious bear market for the stock as the economy of the entire country came into a huge crisis. The broader market has fallen over 20% in the last 2 sessions and that is adequately reflected in the stock. Expect more downside in the next few sessions and sub-$2.00 levels would be very normal.

About the Author

Sally joined the US Markets Daily News Team in April 2011 as a Multimedia Journalist.

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