In less than a year, banks and servicers have restructured total loans of 12.3 billion euros, according to a Finance Ministry report on the progress of credit management. The loans restructured between July 2019 and May 2020 numbered 252,529 and concern all categories – i.e. corporate, consumer and mortgage loans.
The vast majority of those restructurings were made by banks, which in those 10 months drew up payment plans for 200,638 loans adding up to €10.2 billion; in the same period, the loans restructured by servicers amounted to 51,891 and added up to €2.15 billion.
The ministry data showed that in March, the month when the coronavirus pandemic hit Greece, banks made 10,148 loan restructurings that came to €601.8 million. Almost half of them (49.45% or 5,018 loans) concerned consumer credit worth €64.91 million and another 41.27% (4,188 loans) had to do with mortgages amounting to €288.88 million, while 932 loans to small and very small enterprises worth €214.32 million were restructured, plus another 10 loans to medium-sized and large enterprises that came to €33.79 million.
In the same month, loan management companies restructured 3,217 loans from all categories, adding up to €88.1 million.
The report notes that the government is promoting a program for the protection of borrowers’ primary residences (known as the “bridge program”), through which the state will for a certain period of time subsidize a significant part of the monthly tranches of debtors affected by the pandemic who have loans secured against their main residence. The program remains under negotiation with the country’s creditors and is expected to be finalized next month for its application to begin immediately.
In the meantime borrowers can still have their primary residence protected via the online platform of the Special Secretariat for Public Debt. According to ministry data, over 4,500 applications were submitted on that platform from July 2019 up until a few days ago, posting a constant increase month after month, and even during the lockdown period. The government has proceeded to significant legal and operation improvements to the protection program so as to facilitate the submission of applications, and has also seen to the immediate activation of state subsidies.