During the last few years, the Second Banking Directive has set out the principles
of banking in the single European financial market and provided equal competitive
conditions for all European banking institutions. Thus, banks have been forced
to be more competitive and to implement bank rating systems to evaluate their
financial risks. The present study evaluates the performance and efficiency of the
commercial and cooperative banks in Greece for the period 2003-2004. Moreover,
the Greek banks are rated based on their performance. The ranking result can be
used to analyse the strengths and weaknesses of a bank compared to its competitors
and it can serve as a basis for the construction of a rating system for Greek banks.
The results obtained indicate that commercial banks are tending to increase their
accounts, to attract more customers and ameliorate their financial indices, thereby
becoming more competitive and maximizing their profits. Concerning the cooperative
banks in Greece, the conclusions are not so uniform, since there are banks that
are enjoying considerably increased profits and market shares, and others whose
financial indices seem to be deteriorating.
