Bankers are worried about delay in draft law on debts

Bankers are worried about delay in draft law on debts

The delays in the tabling of a bill concerning out-of-court debt settlements and the immunity of bank officials are generating concerns regarding the achievement of the target set by the European Central Bank’s Single Supervisory Mechanism (SSM) for a 40.2-billion-euro reduction in the sum of bad loans by the end of 2019.

The months-long delay in the completion of the bill, which will pave the way for a debt haircut for sustainable enterprises, has allowed outstanding obligations to grow while putting into doubt the sustainability of indebted enterprises that should qualify for an out-of-court settlement.

The target set by banks concerns the retrieval of more than 30 billion euros from successful loan arrangements within three years, while the sum to be forgiven is projected at some 14 billion euros.

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