Goldman Sachs Tips Greek Banks for Gains Amid Valuation Gap

Goldman Sachs has named Greek banks among its top European banking picks for September and the final quarter of 2023, citing attractive valuations compared to other markets. The US investment bank described Greek lenders as a 'top long rate-sensitive' choice, meaning they are expected to benefit particularly strongly from the current interest-rate environment.

The valuation gap between Greek and Spanish banks is seen as a key factor in Goldman Sachs' positive view of Greek lenders. While similar underlying dynamics exist in both markets, Greek banks continue to trade at significantly lower valuations than their Spanish counterparts.

Greek banks are also set to benefit from the inclusion in the SX7E European banking index in September, which Goldman Sachs sees as an additional near-term market catalyst. The bank's positive view of Greek lenders is supported by favourable earnings momentum across European banking and strong shareholder returns.