The Bank of Greece is drafting a plan to reduce Greek banks’ non-performing loans by 40 billion euros. The plan will be included in a Financial Stability report to be released by the end of the week, according to sources cited by ANA.
The plan will include, among others, the transfer of half of the capital resulting from a deferred tax to a special purpose vehicle (SPV), which will issue bonds to purchasing non-performing exposures of a nominal value of around 40 billion euros from the four Greek systemic banks, thus reducing Greek banks’ NPLs stock by half.
The advantage of the plan, Bank of Greece officials said, is that a deferred tax cannot be considered as state support to banks.
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