Mechanism for debt settlement progressing

Greek authorities are speeding up efforts to implement a new out-of-court mechanism for debt settlement, with loans worth more than 20 billion euros currently at an advanced stage of the mechanism, of which €3 billion have been submitted covering 6,500 debtor applications, Finance Minister Christos Staikouras said on Wednesday.

Speaking to reporters during a news conference together with Private Debt Management Special Secretary Marialena Athanasopoulou, Staikouras said the pace of application completion has been progressing rapidly in the last few weeks.

“Building on intense efforts by all participants in the last few weeks, more than 200 applications were completed on a weekly basis, with an average debt level of more than €200 million. So far, 425 applications were successful, of which 288 from banks and services, and 137 from the state. These debt settlements offered a haircut of up to 33% while the average duration of payment settlement was 253 months,” he said.

Staikouras did note, however, that 1,200 applications were still pending, accounting for more than €1 billion in debt, and stressed that the average rate of approval was 46% – an alarming rate – while noting that there is significant room of improvement on the creditor side.