Beset Greek Banks Plan 60 Billion Bad Loans Cut

FILE - A man walks outside the headquarters of the Bank of Greece, in central Athens, on Monday, Jan. 28, 2019. (AP Photo/Petros Giannakouris)

ATHENS – Buried under a mountain of bad loans from people who can’t – or won’t – pay, Greece’s four biggest banks said they want to get rid of 60 billion euros ($67.48 billion) of them by the end of 2021, although many had already been sold to collectors.

The new three-year plans aimed at cutting bad loans to be presented to the Single Supervisory Mechanism by banks at end-March will be more aggressive than originally planned in a bid by Alpha Bank, Eurobank, National Bank of Greece and Piraeus Bank.

The new target is up from the original 50 billion euros ($56.23 billion) goal, said Kathimerini, as the banks continue to struggle with the Non-performing Loans (NPLs) that have been burdening them during a nearly nine-year-long economic crisis.

Many people are legitimately unable to pay because of big pay cuts, tax hikes, slashed pensions and worker firings and Prime Minister and Radical Left SYRIZA leader Alexis Tsipras, in a bid to help banks that are party’s alleged ideological enemies, agreed to let them sell loans to collection agencies and foreclose on homes.

The new goal is seen as perhaps too ambitious given the slow pace of trying to collect the bad loans and with the government’s goal of 2-2.3 percent growth unlikely without a cut in the NPLs and ability of banks to start lending more if they don’t have enough capital.