Greece implements new non-performing loan management rules

Significant changes are coming to the management of non-performing loans in Greece starting September 1. A primary focus is the approximately 100,000 loans subject to the Katseli Law. Following a Supreme Court decision, interest will now be calculated based on the monthly installment rather than the total outstanding loan amount. This change is expected to reduce the burden on borrowers and may trigger refunds for those who previously paid higher interest rates.

Banks and servicers are currently preparing new payment schedules and a platform for recalculating debts. This shift is also impacting recovery efforts; the expected impact on the 'Heracles' securitizations is estimated at approximately 700 million euros, which is lower than the initial pessimistic estimate of 1.1 billion euros. Other areas under scrutiny include 'step up' mortgage loans, Swiss franc debts, and a new regulatory framework for debt management companies.