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Greek Bad Loans Soar To €100 Billion
Just when you thought it was safe to buy Greek Banks (which it is not!) based on the mainstream media narrative that Greece is now fixed, ekathimerini reports that not only are deposits flying out the door at unprecedented pace (albeit stalled by capital controls) but non-performing loans have increased dramatically in the last few weeks as hundreds of households and enterprises have stopped making their repayments either due to a genuine inability to pay or because of the general uncertainty in the economy that has seen transactions freeze.
Data from banks show that repayments declined to between 20 and 50 percent of performing loans, creating the conditions for a major increase in bad loans. This trend is in line with the estimates of the Bank of Greece, according to which NPLs amounted to 40 percent of the total at the end of 2014, with the likelihood they will grow further in the first half of the year.
As a reference point, there is a little over €210 billion in total Greek loans, both performing and non-performing, currently and about €120 billion in deposits. There is also about €90 billion in Emergency Liquidity Assistance from the ECB.
The total amount of bad loans (those which have remained unserviced for at least 90 days) has reached 100 billion euros, and the BoG data show that 70 percent of the loans that have entered payment programs remain nonperforming.
This is a major problem for the Greek Banks but even more so for The ECB as there is not much it can do to 'control' NPLs and given provisions for bad loans are a mere EUR40bn - there is a big hole here that no one is accounting for.
Although the recent deterioration is not yet reflected in the official indices, as it concerns payment delays of one or two months, the picture banks present is one of hundreds of households in payment schemes freezing their payments and entering the stage of partial delay. However, we will not get an idea of the full picture as long as banks remain closed.
But aside from that, Greece is fixed.
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Does Greece get to keep their flag atop the Hellenic Parliament building or is it being replaced with another country’s (wink-wink) flag? ;-)
Looney
I think with the amount of money they have taken and not returned, the Jolly Roger would be appropriate.
Greece is going to be taking it up the ass so much over the next 50 years that they might as well fly the Rainbow flag over Parliament and light up the Parthenon with the Rainbow lights just like Barry Fudgepacker did all over the Whitehouse.
This is so true. And the people actually voted against bending over, so do we call it repo or rape?
I wouldn't pay my parents car loan right now if I were them.
Samurai Bonds Bitchez
Molon labe MF'ers.
Too bad they didn't keep any of it. Greece is just the conduit between European banks and the IMF. I think of it as a giant laundering operation.
ok then 100 billion + 86 billion for the package
heard there are problems to collect the 50 billion guaranty assets
When you can't print endless cash via new loans then shit gets real bad real quick.
Greek debt was only 110 billion euros just five years ago and 323 billion euros today. Now bad loans are almost that.
The Greek Government currently owes 323 billion euros — almost three times as much as it did in 2010 when debt was 110 billion euros. The debt rose 213 billion euros, during 5 years of IMF-imposed “austerity” — the Greek depression.
"Just Observing" and "Pool Shark" indeed. Whatever happened to Withdraw Sanction here at ZH?
This place really is an endless source of fascination and true "font OD Wizardry."
Anywho...sure looks like this one is ASSBACKWARDS to me.
They need a EURO-TARP to start clearing off the now OBLITERATED Bank Balance Sheets...so, NEIN...
That problem still remains.
Can of course just keep the Banks closed and loot the joint.
That strikes me as a rather inefficient outcome though.
What's the Greek Legal system like again? Is rape still considered a Legal Application to Violation Number One over there?
Well, given the banks in Greece are locked up tight, one can only expect this number to increase at a faster pace, no?
i'm under water and the sheriff isn't serving foreclosures anymore anyway so why make payments?
If you are worried about Greece exiting the euro, it makes perfect sense to delay your payments. Why pay with euros today when you can pay with drachmas tomorrow?
If I was living in a bankrupt country (Greece?) I would not be paying my bills either. Especially if all the banks were closed, and I couldn't get at my cash.
Oh shit, maybe I am living in a bankrupt country.
Next.
The United States and Greece share many commonalities. In this instance, a highly contagious disease, commonly contracted through unprotected mental intercourse with ideologues such as Krugman. This particular disease is known as Keynesianism. The disease debilitates the host by corrupting its cerebral cortex and establishing a degenerative addiction. This affliction forces the host to in-debt itself through debt monetization and debt instrumentation. As the disease worsens, a borrowing and spending frenzy occurs in a futile effort which exacerbates the condition. In the terminal phase of the disease, the host attempts to achieve escape velocity by borrowing itself out of debt.
That was the best post from you for many days. Congratulations!
Exclusive: Yanis Varoufakis opens up about his five month battle to save Greece
http://www.newstatesman.com/world-affairs/2015/07/exclusive-yanis-varouf...
From the New Statesman article:
"In his first interview since resigning, Greece's former Finance Minister says the Eurogroup is “completely and utterly” controlled by Germany, Greece was “set up” and last week’s referendum was wasted."
The Fourth Reich has arrived, right here, right now.
brings up an interesting question though. i wonder how much in greek mortgages and other personal loans is held by foreign entities?
Ask Schäuble..
http://www.thepressproject.gr/details_en.php?aid=79155
i'm talking about souring private loans, mbs, auto loans, and the like. my guess is that the norway teacher's pension fund must own at least some of that stuff.
Greek RMBS, interesting thought.
who cares anymore...
the Greek people dont so what am i supposed to do....
as hundreds of households and enterprises have stopped making their repayments
Hundreds? Quite normal even in the village where I use to live.
"But aside from that, Greece is fixed."
Kind of similar to what a veterinarian does to your cat.
This is not a problem here in Europe.
There are bad performing loans EVERYWHERE. The Europeans have a smart (read smartass) solution, don't do anything with them.
Remember that European Stress Test? The last one gave an ALL CLEAR to all the Greek Banks, just like they did Italian, French and Spanish banks!
So you see it means nothing! Everything is a lie here in Europe. Treaties like Maastricht mean nothing, Stress Tests don't mean anything, bad performing loans are meaningless.
The only thing that really matters and becomes real is when the governments can't pay the bills anymore...everything else is ACADEMIC, or as that imbecile Varoufakis says, "Game Theory", yeah right jackass as if you know anything about game theory, you can't even understand your own debt problem.
Forget the bad performing loans, they will just stay there for years and be slowly bled out. The real action is about to begin. Keep your eye on Draghi, he is about to push to the buttons on the printers...the money is going to be streaming out. There is going to be a killing to be made here!
My Tip: Keep your eye on Deutsche Bank stock (DB)! That baby is going to fly.