National Bank of Greece, Eurobank, Piraeus Bank, Alpha Bank and Opap have passed an MSCI simulation test as Greece moves closer to an upgrade from emerging to developed market status.

The successful simulation means the five stocks are expected to make up the MSCI Greece index once the Athens Stock Exchange is upgraded.

According to a report by Morgan Stanley, the upgrade is expected to strengthen Greece’s position in international markets, while increased demand from developed market investors could generate meaningful capital inflows.

Morgan Stanley examined the latest announcement by MSCI regarding the process to upgrade Greece from an emerging market to a developed market.

The final decision is expected to be announced by the end of March 2026, and if approved, the upgrade would be implemented on August 31, 2026.

Some market participants have described the process as unprecedentedly fast tracked, viewing it as a sign of strong backing from investors, while Morgan Stanley reiterated its positive stance on Greece.

MSCI has launched a public consultation on the proposed upgrade of the MSCI Greece index from emerging market to developed market status.

This move follows earlier MSCI consultations on waiving the size and sustained liquidity requirements, which Greece failed to meet during the June 2025 review.

The current consultation accelerates a broader wave of expected upgrades this year, with STOXX due to announce its decision in April and FTSE set to implement Greece’s upgrade in September.

Morgan Stanley underlined that MSCI’s decision to speed up the process is highly unusual, as the initial expectation had been for consultation to begin in 2026, with a decision in 2027 and implementation in 2028.

The bank interpreted the acceleration as a strong signal of investor support for Greece’s return to developed market status.

On investment flows, Morgan Stanley estimated that the upgrade would have a mildly positive impact, with net inflows of around $0.8 billion, easing concerns over potential outflows from emerging market funds.

The analysis showed that Greece is already over positioned among EEMEA and emerging market active funds, limiting downside risk from reallocations.

By contrast, positioning among developed market investors remains relatively low, with only 8 per cent of European equity funds currently holding Greek stocks.

Exposure rises among international and global developed market funds, suggesting scope for increased allocations following the upgrade.

Based on MSCI’s simulation results, the MSCI Greece index would include five stocks in developed markets, compared with eight in emerging markets today.

The five stocks advancing are the four systemic banks and Opap, which all met MSCI’s criteria under the developed market framework.

Under the new structure, MSCI Greece is expected to carry a weight of 0.06 per cent in the MSCI World index.

This compares with a current 0.57 per cent weighting in the MSCI Emerging Markets index, highlighting the trade off between index prominence and market quality.

Morgan Stanley concluded that while near term flows may be limited, the upgrade marks a structural milestone for the Greek market, reinforcing its credibility and long term appeal to global investors.