The regulation regarding the settlement of bad mortgage loans, estimated at approximately 27 billion euros, is at an advanced stage, according to outgoing Development Minister Nikos Dendias.
The minister also presented the details of the settlement on bad business loans, which are estimated at 40 billion euros.
The settlement of the overdue mortgage loans provides for a 30 percent reduction in the value of the property on which the original loan had been granted and the separation of the loan into two parts. The main part of the loan will be repaid to the bank and the remainder will be transferred, remunerated or not, to at least a decade or 15 years later and then it will be evaluated again after a renegotiation based on the value of the property at that time.
The minister said he has already informed the troika and there is a discussion with two of the four systemic banks, one of which seems to agree. He also stressed that the protection of primary residence is taken for granted.
Mr. Dendias told deputies that the amendment “was an effort to relieve the debt of professionals and businesses, first of all to the lenders” and was linked to the measure that Parliament passed a few days ago for the repayment of arrears to the State and social insurance funds, in installments.
He explained that the amendment followed the system implemented on arrears to the State and the insurance funds which means that any future improvement in the installments system would result in a similar change in this amendment.
The minister also referred to the Article on the operation of the Institute for Growth, to which funds from the European Investment Bank, Germany, France, the Onassis Foundation and the Greek budget have been offered and which the government believes are a very important tool in the efforts to relieve professionals and businesses and help them escape the crisis.
He acknowledged that the amendment, under Parliament’s standing orders, cannot be discussed in the parliamentary committee; he clarified, however, that he tabled it on Monday so that political parties and deputies can have the time to study it until its debate in the Plenary.
“I hope…that we will have a concession much wider than a governmental majority”, he stated and welcomed any contribution by the deputies on this issue.
The main focus of the specific amendment, he said, is on small and medium debtors, namely companies and professionals with an annual turnover of up to 2.5 million euros, who are the majority of those to be benefited by it. These are about 165,000 professionals and businesses with more than 700,000 jobs that eagerly anticipate the amendment.