While Greek banks are struggling with a mountain of bad loans driven by people crushed by austerity being unable to pay, Cypriot banks who brought their country’s economy to the edge of ruin are cutting theirs fast.
The Toronto-based ratings agency DBRS said Cypriot banks have reduced the number of bad loans by some 23 percent since 2015 after they had risen when the government, as part of terms to get a 10-billion euro ($11.82 billion) international bailout in 2013, authorized austerity and bank account confiscations.
“Nevertheless, the NPL (Non-Performing Loans) ratio remains high, as total loans continue to decline, reflecting the ongoing deleveraging of the economy. NPLs for the banking system were 43.8 percent of total outstanding loans in August 2017, compared with 49 percent in May 2016,” said DBRS.
The government, with President Nicos Anastasiades reneging on promises to root out bankers who gave bad loans to Greek businesses and overbought Greek bonds that were devalued 74 percent, also authorized home foreclosures and the sale of bad loans to debt collectors to hound people to pay.