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Tsunami risk assessment is an important component of the planning for risk reduction. We considered tsunami risk as a convolution of tsunami hazard, vulnerability of the assets at risk (e.g. buildings) and the economic value exposed. For testing the model, a coastal segment at the west of Heraklion, capital city of Crete Isl., Greece, was selected. Heraklion was hit in the past by strong tectonic and volcanic tsunamis, generated along the Hellenic Arc in the Mediterranean region. The Minoan tsunami produced by pyroclastic flows during the LBA (17th century BC) great eruption of Thera (Santorini) was selected as an extreme tsunami scenario for the hazard (inundation) zone determination through numerical simulation based on Boussinesq equations for fully non-linear waves. It was found that the wave penetrates inland up to ~ 1.2 km, while the maximum water depth is ~ 14 m. The building stock was obtained from the 2011 national census data and validated with the use of orthophotomaps, field inspection and Google Maps. Building vulnerability was determined with the use of the empirical GIS tool DAMASCHE which is based on 2004 Indian Ocean tsunami building damage data and produces damage level by combining water depth and building construction types. The damage level was translated to absolute monetary loss on the basis of cost flat rates determined officially for building replacement, i.e., either reparation or reconstruction, after the destructive earthquakes in Greece during 2014. The method is applicable in other parts of the Mediterranean and beyond provided that appropriate data are available. [ABSTRACT FROM AUTHOR]