Financial experts agree the development of a Greek NPL (non-performing loans) market is essential for Greece’s financial recovery. A robust NPL market will free capital and resources to support new loans and lower interest rates, as well as improve bank risk management and recovery rates. The development of an efficient NPL market is tied to the existence of third-party specialized service companies allowed to purchase distressed debt. However, there have been impediments hindering the development of a Greek NPL market. Recently the Greek Parliament passed a law introducing a regulatory framework for servicing and transferring NPLs. The new law, applicable to certain types of loans on February 15, 2016, sets forth the requirements and obligations for companies seeking a license to establish NPL services in Greece, and addresses what criteria the Bank of Greece will apply in determining which companies may acquire and service NPLs and how they may do so. While the new regulatory framework removes many barriers for servicing and asset management companies to enter the Greek NPL market, there remain several open or unclear issues on how NPL services will operate from both the consumer and company perspective.
If you or your company has debt in Greece which may be subject to NPL transfer, or if your company is interested in entering the NPL servicing industry in Greece, consult an attorney at an Ally Law member firm for advice on actions to take and ongoing developments to the regulatory framework which may impact your decisions. For more information about our services in this area, contact us at yourally@ally-law.com.
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By Your Legal Partners.
