Another €1 bln in Hercules
Greece’s request to the EU Directorate General for Competition, to be submitted in early October, foresees new guarantees of 1 billion euros in the context of Hercules III for helping banks clear out bad loans.
The expansion of the program by €1 billion increases the amount in guarantees that the state has provided or intends to provide in the context of Heracles III to €3 billion (from €2 billion that was initially approved), while in total the guarantees from the three successive expansions of Hercules are estimated to amount to close to €23 billion.
The National Economy and Finance Ministry has already started its exploratory contacts with the competent EU directorate for the approval of the additional amount of guarantees.
DBRS estimates the amount of guarantees repaid to date at €2.2 billion out of a total of €19.2 billion guaranteed by the state for 17 securitization transactions amounting to €42.8 billion. Based on the same analysis, the outstanding balance of guarantees stood at €17 billion at the end of June and, as DBRS observes, “the decrease of around €2.2 billion, or 11.5%, shows that the majority of business plans still need to be worked out.”
