They may not have “zeroed out” the “red” loans under their control, but non-performing loans (NPLs) in Greek banks are certainly at a fifteen-year low. The NPL rate of 4.6% recorded in the third quarter of 2024, according to official data from the Bank of Greece, not only confirms the very positive evolution of the out-of-court mechanism, but also presents a better picture even before the crisis, as this indicator stood at 5.2% in 2007.

Taking advantage of “Hercules III”, which has been extended until June this year with a “dowry” of another billion from the original budget, Greek banks plan to further lower the bar on “bad” loans in the first months of 2025, thus planning to securitise with the 3 billion guarantees of the new “Hercules”.

Of course, one of the main problems of the market, which is often discussed, is the management of “bad” loans, which have left the banks’ balance sheets but remain in the economy until they leave the management companies (servicers), as regulated or written off.

The out-of-court mechanism, one of the life-saving tools in the management of private arrears, has begun to bear significant fruit in the overall picture of the market, following the improvements it has received.

Original Story: Banks.com | Author: Newsroom
Edition and translation: Prime Yield