Bloomberg: Athens eyeing ‘bad bank’ to manage banks’ piles of NPLs; banking index recovers on Thur.
Bloomberg on Thursday – a day after “Black Wednesday” for the banking index at the Athens Stock Exchange – reported that Greek authorities are considering various initiatives to prevent a new sell-off of bank shares.
Bloomberg said one of the proposals eyes the creation of a special purpose vehicle to manage “bad debt” held by Greece’s systemic banks. Another dispatch by the same media provider a day earlier was cited by finance ministry sources in the evening as causing an “over-reaction” by investors.
The Tsipras government, according to the report, has promised to take necessary measures in cooperation with banks’ managements and the Hellenic Financial Stability Fund (HFSF), itself a special purpose vehicle created during the first memorandum (2010) to assist in the stabilization of the Greek banking sector.
Wednesday’s Bloomberg report, citing highly ambitious targets by Greek banks to reduce NPLs by up to 60 percent until 2021, was followed by a mass sell-off at the ASE of the credit institutions’ shares.
Just after noon (10.35 GMT) on Thursday in Athens, the banking index at the ASE was up by an impressive 8.8 percent.
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