Govt denies it relinquished right of borrowers to buyoff loan before distress funds sale
The latest political furor that erupted in the country over the weekend involved the pressing issue of non-performing loans (NPLs), with the government rejecting sharp criticism that it relinquished the option of a borrower buying off the entirety or a portion of their loan before the latter is sold to a distress fund.
Economy Minister Giorgos Stathakis said creditors insisted on the matter, not the leftist Greek government.
A front-page story over the weekend charged that the Tsipras government relinquished the right, which would have given borrowers – once a legal framework is modified in the country, as per a third memorandum obligation – the first right over their loan, be it a mortgage, business financing or even a consumer loan.
Stathakis said that after the negotiations “we have the following (situation): Before a (Greek systemic) bank sells the loan (portfolio) it is obliged to make an offer to the borrower in the previous 12 months. Therefore, there is a safety mechanism for this issue. It is misleading that this (regime) exists in Cyprus, it does not exist there, the same situation as Greece exists, with the legislation that we have submitted.”
Stathakis maintained that a code of ethics drawn up by the government and the Bank of Greece stipulates that a loan can be repurchased at a rate that is below the nominal value.
NPLs in the country held by systemic banks now exceed 110 billion euros.
You may be interested
Environment may have partially led to the fall of Queen Cleopatra, research suggestsPanos - Oct 20, 2017
Environmental records and historic documents suggest a volcanic eruption could have aided the Romans in victory According to a report…
Greek astronomer in Germany discovers spindle-like galaxiesPanos - Oct 20, 2017
Athanasia Tatsi is another Greek scientist at the forefront of global scientific research this time in the field of Astronomy.…
Reuters: Greek banks plan record sale of bad loans as pressure mountsPanos - Oct 20, 2017
Three of Greece’s largest lenders plan to sell up to 5.5 billion euros ($6.5 billion) in bad loans by early…