Bad Loans Amendment Tabled by Outgoing Minister



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Nikos Dendias tabled his last regulation as Minister of Development earlier today. He was later sworn before the Archbishop of Athens and All Greece Ieronymos as the new National Defense Minister replacing Dimitris Avramopoulos.

The amendment regards bad business loans and was attached to a Justice Ministry bill, which is being discussed at the relevant parliamentary committee. The Greek government proposes the write off of up to approximately half of 40 billion euros in bad loans in order to accommodate small business that have been hammered by the ongoing crisis.

According to Mr. Dendias, this amendment was the result of hard work and close cooperation with social partners, the Hellenic Bank Association, the lenders and the European Central Bank and its aim is to to exhaust the possibilities of the system and the economy and “succeed in the restart of the Greek market.” Continuing, the outgoing Minister underlined that it is part of “an effort to relieve the debt of professionals and businesses, first of all to the lenders and is linked to the measures for the repayment of arrears to the State and the social insurance funds in installments.”

According to the government, about 180,000 small and medium businesses were eligible for a write-off of up to 50% of overdue debt to banks if they started making payments again, while currently the amendment targets almost 165,000 minor businesses, providing more than 700,000 job positions, that owe an average of 45,000 euros each to the banks. “These are businesses that have been badly hurt by the crisis and survived. It is our moral obligation to do that for them,” Mr. Dendias underlined, concluding that the European Union and International Monetary Fund lenders were positive towards the move, but some details still need to be arranged.