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GreeceBusinessFinance Minister Staikouras: Greek banks must pull their weight and help borrowers

Finance Minister Staikouras: Greek banks must pull their weight and help borrowers

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The Greek “banking system must rise to the challenges” of current uncertainty, Finance Minister Christos Staikouras said in a statement to Athens-Macedonian News Agency (ANA-MPA) published Sunday.

“Today, in a climate of increased challenges, rising threats, strong volatility and high uncertainty internationally, the banking system must rise to the challenges,” Staikouras said, following a meeting he held recently with bank chiefs. Their main focus was the repercussion of the rise in interest rates on loans following the the Bank of Greece’s (BoG) policy to deal with inflation. Banks have appeared reluctant to assume the cost of relief necessary.

The government and BoG’s governor are concerned about the rise in nonperforming loans (NPLs) and the strain on borrowers’ family incomes. Central bank governor Yannis Stournaras had foreseen a rise in NPLs, with the rise in loan installments also resulting in the rise of loans businesses owe to banks as well.

Staikouras told ANA-MPA that from the start the government has supported and continues to support society to the greatest degree possible. The support has taken the forms of significant reductions in tax and social insurance contributions, widespread introduction of measures to face externally generated obstacles, boosting employment, investments, and social cohesion, implementing structural changes and reforms, and using available European funding quickly and effectively.

“This support indirectly also benefits the financial sector, which – following the effectively implemented economic policy and the Greek economy’s positive outlooks – presents a much more robust picture compared to the past, and faces very favorable prospects,” Staikouras said.

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Among measures the Finance Ministry has said should be implemented by banks are the following:

To extend credit with all available tools to possible borrowers; to use the new and updated extrajudicial system to arrange debt repayments, in order to be protected against new threats; to reform their policies on charges levelled on loans, deposits, and fees, in order to stop burdening family budgets disproportionately; to show sensitivity to vulnerable social groups; to train their staff and customers to use digital processes; and to contribute to the economy’s green transformation.

“All of the above are necessary in order for banks to contribute their significant fair share in the transition effort toward a more dynamic, productive, more extroverted, digital and green economy that does not exclude anyone or create inequalities,” the Finance minister stressed.

SOURCE; ANA-MPA

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