Greece Ministry of Finance disputes PASOK's non-performing loan proposals

The Greek Ministry of National Economy and Finance has issued a response to proposals from the PASOK party regarding the management of non-performing loans (NPLs). The Ministry criticized the party's suggestions, characterizing them as unrealistic promises that could mirror the economic instability seen in 2015.

Addressing the so-called ‘Cyprus model’ mentioned by PASOK, the Ministry clarified that Cypriot law does not grant the specific rights suggested. According to the Ministry, Article 18 of Cypriot Law N. 169(I)/2015 allows borrowers or guarantors a 45-day window to submit a purchase proposal for a credit facility before it is sold, but it does not provide the broader rights claimed by the opposition.

Separately, discussions regarding NPLs continue to focus on six key areas for borrowers and servicers. Concerns have been raised regarding debt restructuring models where payments may only cover interest rather than the principal, potentially leading to situations where the total debt remains unchanged or even increases due to compounding interest.