Finance Minister Christos Staikouras closed the debate on an amendment that would facilitate the holding of auctions by bad loan funds, speaking to a committee of the Parliament. The Minister of Finance, referring to reports that stated that an issue has arisen with the Supreme Court of Justice and that allegedly “The government is withdrawing the amendment on auctions”, clarified that in order for the government to withdraw an amendment, it must have been submitted, but such an amendment was never submitted.
In the past few days, reports have spoken of the government backing away from the hot economic and political issue of the amendment which would have fixed the loophole in the legislation and would have made it legal for Servicers to proceed with foreclosures and auctions.
As the reports indicated, the government is sending the matter to the Supreme Court, in order for the Plenary to decide. This decision, they said, is attributed to the political cost that the controversial amendment would cause, especially in view of the pre-election period.
The contradictory decisions of the Supreme Court regarding whether or not the servicers can proceed to an auction was the subject of a discussion between the servicers and the Special Secretariat for Private Debt Management.
Reportedly, given that the Plenary Session of the Supreme Court will be delayed for a few months to decide and then the pre-election period will officially begin, there will be a significant problem in the business plans already under pressure to achieve the goals and by extension to Hercules guarantees if the revenues are not achieved. They even add that in the best case scenario, the restart of auctions related to the arrangement will begin in the fall of 2023.
The issue of legalizing or not the servicers to proceed to auctions arose after a decision of the Supreme Court, with the argument that the securitizations were based on the legislative framework of 2003 and not of 2015. However, there were later decisions that justified the servicers.
Adaptation/Summary: Kiki Athanasiadis