By Emmanouela Depounti, Attorney at Law, Former legal advisor of Agricultural Bank of Greece SA, Former introducer of Astrobank Ltd (Cyprus).
Part of the population in Greece strongly believes that the reason why the subject of non-performing loans (NPL) was allowed to reach the dimensions it has today, is the role of third-party funds, by way of the benefit that the funds would have to recover from the sale of such loans.
I criticise this assessment as short sighted, because if the funds had taken over in 2010, in 2012 or in 2014 or in 2015, they would have derived greater profit.
The reason is that today the non-performing loans to the extent of some 75% are almost impossible to be served by borrowers (due to the financial crisis and over-taxation): there is no guarantee that the funds will have to present a logical anticipated benefit from any setting they try to impose on the borrowers.
Although today the funds will buy NPL packages cheaper than in the past, that still does not guarantee their performance.
And why? Because it is impossible in the Greek culture to accept that inhibition, procrastination, the “ochadelfismos” theory, the transitory joy in front of ease of acquisition of (loaned) money and the refusal of the liability imposed on both sides (lender and borrower) are the reasons that have driven the situation to its present pass.
And that phenomenon in Greece is not only in the banking sector, but unfortunately is a photo-image of the Hellenic temperament. .
So, it would be more beneficial to stop creating enemies and ghosts and begin looking at our reflection in the mirror and start the changes from there… if we do not want this crisis to keep repeating itself……………..
(Disclaimer the contents of this text are for information only and consist of personal opinion and in no way are an investment consultation, or subscription for participation or non-participation in any transaction. The author is not responsible for any investment or other decisions made on the basis of this information).