ATHENS – Buried under a mountain of 110 billion euros ($123.37 billion) bad loans, Greek banks will try to cut them in half.
Greeks crushed by austerity measures can’t pay their loans, credit cards or mortgages, undermining the banks which have received some 50 billion euros ($56 billion) in state aid fro international loans.
Banks are chasing debtors, except for the former ruling New Democracy Conservatives and PASOK Socialists who together owe 250 million euros ($280.39 million) they got with only taxpayer subsidies as collateral but still aren’t paying and won’t say where the money went.
Kathimerini said the banks will take a three-pronged approach to the problem: restructuring non-peforming loans, writing off uncollectable loans – mostly for businesses – or selling the loans to third party collectors, which Prime Minister and Radical Left SYRIZA leader Alexis Tsipras swore he would never do.
The first method could bring in 25 billion euros ($28.04 billion) by giving debtors better terms for repayment while the banks would write off some 10 billion euros ($11.22 billion.) It wasn’t said who would benefit from receiving huge loans without repaying them or where the money went.
Collection agencies could bring in five billion euros ($5.61 billion) the banks estimate while taking away the problem from them of going after people who can’t or won’t pay.