Kalantonis (doValue Greece): The next big step for ‘red’ loans

It is crucial to go back to the old banks Of the “red” loans, which have now been cured According to the CEO of doValue Greece, Theodore Calantonis. Generally, they can go back to financial normal life loans for 15 – 20 billion euros, In a period of 3-4 years (about 10% of GDP).

The issue of returning “preempted” loans to the banking system was also discussed in the recent meetings held by the political leadership in Egypt Ministry of National Economy and Finance with the servicewhile it is also one of the issues that is very high on the agenda of the Bank of Greece, so that said loans can be returned to the banking system with the appropriate regulatory framework.

The return of old and now processed loans to their normal place, that is, those of healthy portfolios (i.e. in banks), hides not only risks but also benefits, as mentioned by Thodoris Kalantonis in his recent article in “Kathimerini tis Kyriaki”.

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All winners

The benefits to the management companies (servants) in order to achieve the recovery goals set forth in the securitization business plans, the public who have given their guarantees to the securitization operations under the “Hercules”, the banks (with a positive effect on the expansion of credit and revenue), the economy and, of course, the debtors themselves who, with the reintegration of their loan portfolio into the healthy return (with normal restructuring) of the banks.

“Since 2020 until today, banks, using the instrument of securitization through the application of the Hercules State Guarantee Program (1 and 2), have removed from their balance sheets non-performing loans amounting to more than 70 billion euros. In the same three years, the management companies that managed these loans either on behalf of institutional investors or private vehicles of the “Hercules” program managed to arrange loans amounting to 35 billion euros for more than 700,000 borrowerssays Theodoris Calantonis.

These loans, the doValue CEO explains, remain almost entirely in “special vehicles” created to funnel non-performing loans out of banks.

“However, if you look at its characteristics, it is closer to regular bank loans than non-performing loans. Housing loans are the most common case,” notes the CEO of doValue Greece, as he explained. In order to achieve the arrangements, the workers offered and continue to introduce restructurings with a time depth of 10 to 20 years. The result is a new loan with a long-term servicing perspective that is not dissimilar in its essential features to a new mortgage loan.

“For example, the relationship between debt and property value, after restructuring, is equivalent to what a bank will calculate for a new mortgage, based on its credit policy.”

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Supervisory processing of loans

These loans enjoy special supervisory treatment and are based on European Banking Authority (EBA) rules, once a year of normal service has passed they are considered “organized services” (Valid) and after three years fully recovered, very normal loans, serviced smoothly.

Supervisors are reluctant to immediately give these loans equal status with loans that never stopped performing while they calculated Risk of relapse and default “And the last thing they want, with the experience of the crisis, is a new generation of non-performing loans within the banks.”

However, structured and serviced loans must at some point return to where they belong, by moving the relevant portfolios, according to w. Calantonis who concludes that “today’s favorable macroeconomic conditions are best suited to take the next step with the help of the supervisory authorities”.

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