One-month extension again bars resale of NPLs
The government on Tuesday announced another one-month moratorium, extending to June 15, for the resale of non-performing loans to distress funds, with a relevant amendment submitted to Parliament.
The amendment was included as a rider on a draft bill ratifying a treat between Greece and Vietnam.
As a result, “bad loans” credited to SMEs, consumer loans and primary home mortgages are excluded from resale to distress or investment funds for another month.
The issue of NPLs in the country has been a recurring and contentious point of negotiation between the leftist Greek government and its institutional creditors, with the latter pressing for a liberalization of the framework governing the sector. NPLs in the country now account for more than 100 billion euros, a figure blamed for exacerbating the credit crunch in recession-plagued Greece.
However, despite previous government opposition, an agreement unveiled at this week’s Eurogroup will apparently free up most NPLs for resale on the secondary market, with a temporary exception reportedly envisioned for primary residence mortgages.
Parliament must first vote to approve such legislation first.
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