The Finance Ministry is considering increasing the leeway for companies managing the nonperforming loans in the Hercules asset protection scheme, in terms of how long they have to hit their revenue targets while managing the portfolios they have undertaken, from 24 to 36 months.
The servicers requested an extension of that grace period as they have been unable to achieve the bad-loan revenues targeted in their business plans due to the financial effects of the pandemic.
Failure to meet their targets would not only affect their payments but also the prospect of the activation of state collateral.
The lockdown extension has created serious problems in the collection of loans that were problematic anyway, while there have also been some significant side effects due to the horizontal suspension of forced collection measures.
Bad-loan management companies have undertaken loans of about 31 billion euros through the securitizations included in the Hercules scheme, with the state collateral amounting to some €12 billion, while the collateral projected for the second version of the scheme (Hercules 2) will run up to the same value.