Six new initiatives to further reduce private debt
Duplication of the integration limit in compulsory out -of -court mechanism In order to integrate even more debtors, enhancing the debtor’s protection against the risk of auctioning of his real estate and further acceleration of private debt reduction, including 6 new initiatives presented today by the Minister of Finance. Kostis Hatzidakis and the Secretary General of Financial Sector and Private Management Debt Theoni Alabassi. In addition, initiatives include arrangements related to life insurance compensation and which also relate to the liquidation of “ASPIS PRODUCT”. There have also been data on the operation of the out -of -court mechanism where the progress made specifically in recent months is significant, as the total number of successful arrangements is up to 30,515, with the total value of regulated debts now amounting to 10.01 billion euro.
The Minister of National Economy and Finance Kostis Hatzidakis said: “The issue of private debt management is a priority for the government. We have proven it with a number of legislative initiatives where they significantly improved the operation of the out -of -court mechanism, reinforced debtors’ protection and gave multiple debt settlement options to thousands of citizens and businesses. Progress made is significant as private debt as a percentage of GDP has a steady downward trend remaining below the European average, while non -performing loans decreased from 92 billion in 2019 to $ 67 billion in the third quarter of last year . Today we present additional initiatives, such as doubling the integration threshold in the compulsory out -of -court mechanism, to further shield debtors and further enhancing ways to settle debt settlement to citizens and businesses. Finally, with the arrangements we bring, we close, among other things, a chronic pending that concerns the casualties of “ASPIS PRODUCT” by resolving in a definitive way issues related to life security allowances. “
The Secretary General of Financial and Private Debt Management Theoni Alabassi said: “The volume of arrears that has been burdened by the economy from the crisis years, we can now say that it has been in a serious management track, after a lot of constant and constant work. Judging from measurable results, the out -of -court mechanism proves to be an important tool of wide application that gives solutions to a number of debts and borrowers and contributes significantly to private debt. The close monitoring of the implementation, as well as the key interventions in the anchors we find are the elements that lead a policy to deliver. “
In detail, the 6 initiatives are:
1) Increase in income and assets in order to designate a debtor as an eligible in the context of the compulsory acceptance of the creditors’ out -of -court mechanism. With the arrangement introduced, the criteria for classifying a borrower as eligible in order to comply with the consent of all creditors to integrate the debtor into the out -of -court mechanism. The doubling of these limits is a prerequisite for the debtor to have a maximum of 300,000 euros (ie in banks or services).
The new limits are set as follows:
A) Income limits:
Household
Limits with the current vulnerability regime new limit
One -person household 7,000 euros 14,000 euros
Household consisting of two members 10,500 euros 21,000 euros
Household consisting of three members or single parent family
with a minor member 14,000 euros 28,000 euros
Household consisting of four or single parent family
with two minor members 17,500 euros 35,000 euros
Household consisting of five members and above or single -parent family with three minor members and above
21,000 euros 42,000 euros
(B) Property limits:
Household
Limits with the current vulnerability regime new limit
One -person household 120,000 euros 240,000 euros
Household
of two members 135,000 euros 270,000 euros
Household consisting of three members or single parent family
with a minor member 150,000 euros 300,000 euros
Household consisting of four or single parent family
with two minor members 165,000 euros 330,000 euros
Household consisting of five members and above or single -parent family with three minor members and above
180,000 euros 360,000 euros
(C) deposit limits:
Household
Limits with the current vulnerability regime new limit
One -person household 7,000 euros 14,000 euros
Household consisting of two members 10,500 euros 21,000 euros
Household consisting of three members or single parent family with a minor member
14,000 euros 28,000 euros
Household consisting of four or single parent family with two minor members
17,500 euros 35,000 euros
Household consisting of five members and above or single -parent family with three minor members and above
21,000 euros 42,000 euros
At the same time, through further improvements, the improvement of the Terms of Regulation is launched as the value of the real estate of the algorithm takes into account, but also the rationalization of the “reasonable profit rate” of 10% in the case of legal entities to receive a larger number dose.
It is recalled that the out -of -court debt settlement mechanism is particularly satisfactory with a continuous increase in its results and in the legislative initiatives recently taken (Law 5072/2023 and Law 5113/2024). Indicatively reported:
-Automatic and compulsory acceptance by banks and publicly the debt restructuring proposal for vulnerable debtors.
-Expanding people with a disability rate of over 67% in the category of vulnerable debtors with increased limits on income and property criteria.
-En higher haircut one and 28% in debt.
-Status interest rate for 3% for all arrangements (public, banks, services).
-Possibility regulation of debts to the State of legal entities, which have been put into a solution or liquidation by the co -owned debts.
-Thispay of up to 10% for debtors who have been auctioned with the exception of vulnerable debtors for whom a vulnerable debtor has been issued (where no advance may be requested).
-Possibility of re -establishment of debts to include debts to the State certified in the interim if the restructuring proposal is delayed for any reason.
As a result of all of the above, the total number of successful regulations has increased significantly to 30,515, with the total value of regulated debts amounting to EUR 10.01 billion. In particular, with the improvement introduced by the presumed consent of the creditors in the out -of -court request, the protection of vulnerable borrowers was reinforced, with 2,673 vulnerable households benefiting from debt arrangements. With the new arrangement that is coming, the goal is the number of potentially covered vulnerable debtors to increase significantly.
2) The obligation of the creditor to have deposited at least 3 months before the auctioning a written proposal to the debtor.
In addition to the already operating arrangement and protection tools, with a new arrangement, the creditor’s obligation to submit in writing to the debtor, at least three (3) months prior to the auction, in every appropriate way (including e -mail) proposal for regulation for the auction. the debt for which he has speeded up the auction. However, this obligation does not exist if the debtor has not been registered on the creditor’s electronic information platform, providing a minimum email address and contact telephone.
3) Debtor exemption for which he does not open a bankruptcy procedure but is registered in the solvency register.
With a new arrangement, it is added that the judge rapporteur, at the request of the debtor, to issue an act to find the exemption of the debtor from his debts. It is recalled that if the debtor’s property is not sufficient, a bankruptcy procedure is not opened but registered in the solvency register. Thus, the rapporteur’s ability to issue a judge to issue an act to find the exemption for these debtors.
4) Extension of deadlines so that the vulnerable debtor can enter the intermediate program.
The exclusive deadline of sixty (60) days is abolished, within which the vulnerable debtor is required to apply for his inclusion in the State Contribution Program to vulnerable debtors. This is abolished in order to facilitate more vulnerable debtors to join the Protection Program and rescue their residence from divestment. At the same time, the intermediate program itself extends for 4 additional months to complete the actions required to set up and operate the acquisition and re -lease.
5) Expanding the possibility of regulating loans by guaranteeing Greek government through the consolidation process.
It was expressly instituted the possibility of regulating loans that have a Greek government guaranteed through the out -of -court mechanism with the possibilities of deletions and the expansion of repayment time. This possibility also extends if the debtor chooses to settle his debts through the resolution process. The aim is to help businesses that usually have higher debts and therefore choose the resolution tool, to regulate Greek government loans without risking the guaranteed guarantee.
6) A permanent mechanism for damages of “ASPIS PREVENTION” is created- Issues of compensation are resolved in beneficiaries of life insurance claims.
In order to permanently resolve the payment of compensation to beneficiaries of life insurance claims, which is paid by the Private Life Insurance Fund (EMAIA), a regulation shall be entered by which it is allowed to pay additional amounts to the insured as an advance. The additional amounts paid will take into account the financial capabilities of the EKIAZ, as they will not be able to exceed 25% of its disposal. In this way, the ASPIS PRIVILIGN will be faster in compensation, as a reasonable amount can be provided at regular intervals.
Details of private debt
In recent years, the progress made in the field of private debt reduction is important as reflected in the official figures. There is a significant decrease in non -performing private debt of households and businesses as non -performing loans as a whole, namely banks and services, have fallen from € 92 billion in 2019 to 67 billion in the third quarter of 2024, and their downfall The course is expected to continue thanks to the relevant government initiatives. Private debt as a percentage of GDP has a steady downward trend (93.3%), remaining below the European average (125.3%). Finally, in terms of reducing red loans in banks, through the Hercules program, banks have achieved a significant reduction in non -performing loans in their portfolios. In the third quarter of 2024 the rate reached 4.6% (in 2019 the rate was 40.6%), lower than the period before the crisis.
