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Η λανθασμένη διάγνωση και μυωπική αντιμετώπιση του προβλήματος της οικονομίας εγκυμονεί νέους κίνδυνους

Posted by on August 22nd, 2017 - 102 Comments
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Η τιτλοποίηση και η πώληση δανείων έχει ως σκοπό να παρουσιάσει εικόνα μιας σχετικά ασφαλούς επένδυσης (risk free) με όμως ψηλή απόδοση (high return). Για να μπορέσει όμως η τράπεζα να τα πωλήσει θα πρέπει να τα προσφέρει με μια σημαντική έκπτωση. Δηλαδή, τα ταμεία, και άλλοι επενδυτές που θα τα αγοράσουν θα πρέπει να θεωρούν ότι μπορούν να τα πωλήσουν με κάποιο σημαντικό κέρδος, αλλιώς δεν θα πάρουν το ρίσκο.  Εκεί όμως έγκειται και η ουσία του προβλήματος. Όποια περιθώρια μπορεί να έχει μια τράπεζα για να μειώσει το ύψος των δανείων για να υποβοηθηθεί η αποπληρωμή τους, στο πλαίσιο των προβλέψεων read more…

To the Rescue: How mortgaged homes may be protected – an alternative

Posted by on July 3rd, 2017 - 25 Comments
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The Grim Facts

Cyprus ‘boasts’ the highest private debt level, as a ratio of debt over Gross Domestic Product, across the world (World Bank data, 2015)!  According to the Central Bank of Cyprus’ ‘Household and Non-Financial Corporations Indebtedness Report’ (April 2017), total private debt (the sum of household and corporate debt) is equal to 273% of GDP.  Household debt, in isolation, was equal to 124% as opposed to the Euro zone average of 59%. read more…

Οικονομία Ώρα Μηδέν: Επιστροφή στο Μέλλον;

Posted by on June 26th, 2017 - 5 Comments
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Εύσημα

Μετά την οικονομική καταστροφή του 2013, η οικονομία της Κυπριακής Δημοκρατίας επιδεικνύει αξιοσημείωτη πρόοδο σύμφωνα με τα δημοσιευμένα στατιστικά στοιχεία.  Ανάπτυξη της τάξης του 3,3% μετά από χρόνια ύφεσης, μείωση της ανεργίας στο 12,9% από το υψηλό 17,6% (πρώτο τρίμηνο του 2015), δημοσιονομικό πλεόνασμα 0,4% το 2016.

Η χώρα μας έχει λάβει τα εύσημα τόσο από θεσμούς όπως το Διεθνές Νομισματικό Ταμείο, που στην τελευταία του έκθεση (Ιούνιο 2017) αναφέρεται σε «αξιοσημείωτα read more…

Περί Συνεργατισμού

Posted by on June 19th, 2017 - 7 Comments
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Τον Απρίλιο του 2011 είχα γράψει ένα άρθρο για τους κινδύνους και το πιθανό κόστος που υπάρχει από τον τρόπο λειτουργίας και εποπτείας των Συνεργατικών Πιστωτικών Ιδρυμάτων (ΣΠΙ). Αντιγράφω: «Τα ΣΠΙ αναζωογονούν τον ανταγωνισμό στην τοπική αγορά αλλά αυτή η αναζωογόνηση δυστυχώς μπορεί να έρχεται με κάποιο κόστος.  Οι μέτοχοι των ΣΠΙ είναι οι ίδιοι οι καταθέτες τους.  Άρα ο ηθικός κίνδυνος από την κρατική ασφάλεια των καταθέσεων είναι ακόμη μεγαλύτερος απ’ ότι στις τράπεζες. read more…

Private debt is the problem

Posted by on June 6th, 2017 - 12 Comments
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Why the economic recovery of Cyprus remains an elusive and distant dream

Cyprus suffers from a developing acute case of what Richard Koo (Koo, 2015) has coined as Balance Sheet Recession. This means that because of the excessive and quite unprecedented levels of private debt (3 to 4 times the size of the country’s GDP) weighing on households and corporations, it is practically impossible for the country to overcome the recessionary effects of the austerity conditions that were imposed since the bail-in in 2013 and which still constitute the core of the Government policy.

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Bankers’ Alert: Bloom or Wither? Revolutionise or Rationalise?

Posted by on June 2nd, 2017 - 2 Comments
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PART C

Revolutionary Quantum Leaps

We have seen how the instinctive banking aversion of risk and the deeply ingrained rigidities of conventional banking routines may stall banks’ progress, by deterring them from taking the quantum leaps that are needed to truly get them back to the road of recovery.

True, certain banks are ahead of others on the quest to recovery.  True, certain banks have begun to explore more revolutionary ways of harnessing the NPL beast.  read more…

Bankers’ Alert: Bloom or Wither? Revolutionise or Rationalise?

Posted by on June 1st, 2017 - 7 Comments
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PART B

A Banking Revolution may open up Possibilities

To put everything in perspective in a nutshell, it doesn’t seem likely that the NPLs stock will be worked down to manageable, and economically sustainable, levels any time soon, via conventional and rationalised management.  It doesn’t seem at all likely, either, that large portions of debt can be sold off at prices which would not jeopardise banks’ solvency, at least in the foreseeable future.  And the pressures are, and will keep on, mounting.  To re-cap: read more…

Bankers’ Alert: Bloom or Wither? Revolutionise or Rationalise?

Posted by on May 26th, 2017 - 11 Comments
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Part A

The Stagnation of Banking Conventionalism

There is a well-known axiom in the financial world which stipulates that no banking system, and as a matter of fact, no economy, can survive with non-performing loan (NPL) figures over fifty percent, as is the case in Cyprus; yes, they are stubbornly well over 50% when governmental and non-financial corporations are excluded!

And there is another well-known axiom which says that “as you sow, so shall you reap”.  read more…

Cyprus: Lack of adjustment of household sector

Posted by on May 16th, 2017 - 5 Comments
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An analysis of the results of the Eurosystem’s Household Finance and Consumption Surveys (HFCS) reveals how Cyprus households and their counterparts in certain other financially distressed Euro area countries have been affected by and responded to their financial crises.

According to the first wave results of the HFCS centered on 2009/2010 Cyprus households entered the crisis years of 2012 and 2013 with relatively high levels of real and financial assets, well in excess of the Euro area averages. read more…

Reforming local government finances in Cyprus

Posted by on April 27th, 2017 - 17 Comments
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The local authorities in Cyprus have been in financial difficulties for many years and have been funded in part by the government via the annual grant. The grant is a source of funds that is allocated to municipalities based on their size and to the willingness of central government to continue to provide such assistance; it is not an obligation under the constitution or by legislation. The annual grant as is currently administered and decided is wholly insufficient and cannot be the basis of promoting healthier local government which every modern EU state has committed to institutionalise. read more…