Filenews 18 August 2023 - by Eleftheria Paizanou
Legal proceedings have been initiated against dozens of borrowers by banking institutions for breach of their contractual obligations in relation to €655.4 million of bad loans.
According to Central Bank data forwarded to Parliament as part of the discussions on foreclosure bills, bad loans to banks amount to €2.2 billion. and credit acquiring companies amounting to €21 billion. Of the non-performing loans (NPLs) found in the banking system, legal action was taken against them for a number of borrowers.
The Central Bank (CB) collects data from banks with a bad loan ratio above 5%. The data received by CB corresponds to 81% or €1.5 billion. total non-performing loans held by credit institutions, which provide lending to a material extent in the domestic market.
By the end of March 2023, non-performing loans amounting to €501.4 million corresponding to the 33.5% held by banks, are at the stage of judicial and legal measures and proceedings. Under this regime are loans, for which the bank has formally appealed to the courts.
At the same time, 10.3% corresponding to loans of €154 million. They are at the stage of "pre-trial / legal measures and procedures", i.e. the debtor has already been informed by the banking institution that he will take legal action against him within a specified period of time, unless he makes some payments.
It should be noted that this category also includes cases in which the contract has been terminated by the bank, as the debtor has violated the terms and conditions of the contract, without, however, the bank taking legal action against the borrowers.
Meanwhile, for non-performing loans amounting to €840.2 million, corresponding to 56.2%, no legal action has been taken.
This category of bad loans also includes restructured non-performing loans that are under the monitoring regime, as well as NPLs that fall under the default category.
In relation to delays in the repayment of loans to the banking system, loans amounting to €624 million. (or 28%) are one year late.
Also, 9% of loans, worth €191 million,. They have a two-year delay and €586 million in loans. They are between 2 and 5 years late. In addition, 5% of loans worth €7 million are delayed by 10 to 228 years. and a delay of more than seven years have loans of €26%.
Regarding NPLs of €21 billion. found in credit-acquiring companies, the vast majority have arrears of more than five years. Finally, 84% of NPLs in companies relate to terminated lending and 16% to active lending.
