The recent agreement for a rescheduling of the debts of ailing textile group Klonatex signals the end of the era for Greek bank lending, when loans were extended without adequate credit risk criteria. Indeed, the deal involving the group’s major creditors, the National Bank of Greece, Emporiki Bank, the Agricultural Bank of Greece (ABG), Alpha Bank and EFG Eurobank Ergasias is described as historic due to the strict terms imposed on Thomas Lanaras, Klonatex’s chief shareholder, for the granting of a financial «breather.» The banks appear resolved to end any type of special treatment for certain «privileged» borrowers, as often practiced by the banks of the wider public sector in the past. This does not mean that bankers intend to turn off the tap but they certainly appear determined to stop throwing money down the drain. Lanaras has accepted close bank supervision and will have to dig into his own pockets to save his firm. The recent deal is also historical because it is the first time that an ill-assorted group of banks, public and private, have cooperated in order to impose their terms on an entrepreneur. To date, prominent Greek businessmen negotiated on a one-to-one basis with their lenders and it was usually they, with the help of political connections, that imposed demands and conditions on their bankers. If one bank rejected their demands, customers turned to another and usually got their way in the end. For their part, private banks, often disappointed by the practices of their publicly controlled counterparts, refused to cooperate as they tried to protect their interests. Recent developments include the important role of managers of the more or less publicly controlled banks, who – having served in the private sector – are now implementing their technocratic skills and criteria. It is not seen as a coincidence that the architect of the agreement with Klonatex is the president and CEO of the National Bank, Takis Arapoglou, who has come from Citibank’s international operations. The new president of Emporiki Bank, Giorgos Provopoulos, has also had a long stint in Alpha Bank, the country’s largest private bank. Dimitris Miliakos, the new president of ABG, who has inherited the most problematic of public bank loan portfolios, is reported to be tightening the screws and demanding additional guarantees for an institution with a long history in bailing out businesses with doubtful prospects. Bankers believe other similar cases will follow Klonatex, but add that the number of ailing, loss-making companies is not large and their existence does not present a threat to the banking system.