Greek banks may be next to suffer the blow of the Thomas Cook downfall, according to ratings agency Moody’s, which said on Thursday, that the impact on tourism revenues and investments is bound to affect the country’s credit prospect.
Besides Greece, the Moody’s report goes on to note that the Thomas Cook folding will also have a negative impact on banks in Cyprus and Bulgaria.
The Moody’s report warns that the situation may lead to business closures, particularly in view of the fact that Greek banks have already been struggling to deal with the pile-up of non-performing loans.
According to the ratings agency, the exposure of Greek banks to hospitality and F&B businesses comes to 10.8 percent. Indicatively, according to Moody’s, Thomas Cook owes significant sums to hotels in Greece for holiday programs which ran in July and August as payments were made 60-90 days after travel.
It goes on to underline that the bankruptcy of Britain’s oldest tour operator is likely to also have a domino effect on linked sectors such as transport and trade as well as on the labor market considering that tourism is among Greece’s largest employer.
Looking ahead, Moody’s analysts suggest the implementation of immediate relief measures, adding that affected businesses should look to replace Thomas Cook with alternative operators.
According to reports, the UK travel giant occupied some 1,000 people in Greece, and brought some 3 million tourists to the country, or 9 percent of the total 44 million arrivals to Greece in 2018.
Thomas Cook’s strongest presence was on the islands of Crete and Kos, working with 70 percent and 25 percent of the hotels there, respectively.