New debt agreements from 1.5 to 1.8 billion euros through an out-of-court mechanism are expected from Ministry of Finance from banks and management companies over the next 5 months, calling for “working hard for the benefit of more citizens and the successful repayment of their debts.” Sight, set settings through it extrajudicial mechanism approach a total of 3.9 billion euros by improving the efficiency of the mechanism, which, according to data published by the Ministry of Finance, offers mechanisms with an average haircut of approximately 20% for debts to the state and 30.8% on debts to financial institutions.

The message of speeding up the arrangements was given to banks and management companies during meetings held in succession on Wednesday and Thursday by the Minister of Finance. Christos Staikouras with the administrations Greek banks and heads of the largest management companies, opening the curtain of meetings with representatives of the financial sector for 2023. The meetings were also attended by Director General for Prudential Supervision and Authorization of the Central Bank of Greece Spyros Pantelias and, according to with information from “K”The Treasury Minister called for more regulatory efforts to limit debtor auctions. It should be noted that the issue of auctions is at its peak, since on January 26 at the Plenary Session of the Supreme Court there will be a discussion of the question of whether management companies, as trustees of funds in the context of Hercules securitization, take enforcement measures.

Until the decision is made, as the representatives of the company note, they have every reason to act without holding auctions. Banks and asset managers have committed to more loan agreements in order to reach the goal of increasing agreements by 1.5-1.8 billion euros over the next 5 months. To date, 6,400 claims for the settlement of debts in the amount of 2.1 billion euros have been considered out of court. Another 5,500 debt claims totaling €3.7 billion are also in the final submission and approval stage, and another 33,900 debt claims worth €19.5 billion are in the early stages of filing. The total figures bring the total number of adjustment applications to 45,800 and the value of loans subject to adjustment to 25.3 billion euros, and the fact that the number of completed citizen applications and the rate of debt adjustment is increasing every month is confirmed, according to the Minister of Finance, that it is “the most successful in the last 12 years”. According to the Special Secretariat for Private Debt:

• 74% of candidates for redemption or redemption of debts concern the debts of individuals and only 26% of the debts of enterprises.

• 79% – to banks and management companies and 21% – to the state.

• The average maturity of debt to the state is 18 years, and debt to financial institutions is 15 years.

The average “haircut” for debts to the state reaches 20%, and for debts to financial institutions – 30.8%.

• 33% of debts were repaid for more than 20 years.

• The average write-off rate for government debt is 20.4% and for financial institution debt is 30.8%.

• 39% of agreements (about 320 million euros) have a cancellation rate of more than 30%.

• 54% of settlement proposals were accepted by debtors (€991m out of €1.8bn).

• The level of approval from banks and management companies is 63%, and from the state reaches 93%.