BANKS

The recent bank charges that have been imposed on most transactions are expected to be discussed, among other things, in a meeting on today between the heads of the country’s biggest banks and Prime Minister Kyriakos Mitsotakis.

Talks are continuing on ways to improve a plan being put together by Greece to help banks reduce bad loans, called the Hercules proposal, in a bid to prevent it from being a lost opportunity for the country and its financial system.

Alpha Bank announces that, following an international competitive bidding process, it has entered into a multi-year agreement with doValue S.p.A. (“doValue Group” or “doValue”) for the servicing of a portfolio originated in Cyprus and comprising Non-Performing Exposures (NPEs) and Real Estate Owned (REO) assets, with a Gross Book Value of approximately Euro 3.2 billion.

Bank officials remain cautious about a plan Greece is working on aimed at reducing bad loans held by lenders that was approved by the European Commission last week. Although the scheme, called Hercules, was given the green light in Brussels just a few days ago, some in the industry are already talking about the need for a Hercules II plan, citing concerns about the initial proposal's ability to solve the bad loan problem faced by the financial system.

The European Commission has found Greek plans aimed at supporting the reduction of non-performing loans of Greek banks to be free of any State aid. The Commission found that, under the asset protection scheme (known by the name of “Hercules”), the Greek State will be remunerated in line with market conditions for the risk it will assume by granting a guarantee on securitised non-performing loans.

Greece's Finance Minister Christos Staikouras is scheduled to meet on Thursday afternoon with the heads of the country's banks to discuss the Hercules bad loan plan in a bid to secure the highest participation from lenders and reduce the risk of fresh uncertainty hitting the sector. The meeting comes after a report from Business Daily showing that the technical details of the plan submitted by Greece to the European Commission have not been approved by the European Central Bank's Single Supervisory Mechanism (SSM).

Greek banks are closely watching developments regarding the plan that has been prepared by Deputy Finance Minister George Zavvos. It is seen getting the green light from the European Commission but will not be able to be implemented due to many technical difficulties.

Top bank officials are concerned about the outcome of talks regarding the tackling bad loans and the result that is going to be for the greek banks.