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An asset management company would be the boost the economy needs

Posted by (Guest Contributor) on April 22nd, 2015 - 34 Comments
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In last 18 months we have watched how the various stakeholders of the financial system in Cyprus and the Troika have acted showing complacency at one extreme (remember Mrs.Velculescu saying that NPLs were within the PIMCO assumptions in January 2014) to repeated concern by recent statements of EU/ECB officials on the other.  In fact the non-performing loans from their mid-30s as a percentage of total loans in July 2013 are now over 50% now and possibly rising.  The recent newspaper report attributed a 1/3 of loans restructured reverting to NPL status.  At the same time the banks have slowly deleveraged and until very recently very high interest rates were paid by business.  In such a financial state of affairs it is hard to see how the economy can recover when Cyprus relies on the banking system for its financing of business and investment.  Banks should not have been the managers of NPLs linked to real estates as this is not the job of banks and this is one of the reasons why banks in similar position in the rest of the EU were split into a good /bad bank or where it was deemed best for the bad to be an asset management company. In this article the writer will seek to explain why Cyprus needs an asset management very soon and there is no need to reinvent the wheel by three internal bad banks to manage their NPLs.

Non-performing loans linked to real estate are typically the assets which have a tendency to get worse before getting better assuming the market corrects and price of property falls to attractive levels such that buyers appear to buy at a discounted real estate; such capital is not from domestic sources and as we saw in the cases of Ireland and Spain they are private equity and not hedge funds.  These financial firms have the capital and the patience to asset manage the real estate and seek maximum recovery hence the long term perspective of their investment horizon unlike hedge funds.  The Irish real estate market last year was the best performing thanks to the correction prices experienced and the investment of billions by foreign private equity firms and real estate investment trusts (REITS).  The same, to a large extent, has happened in Spain albeit not with such success due to the large amount of small loans which represented the loans transferred to SAREB by BANKIA.

Hence the two most identical comparisons that one can look to see the result of how banks managed their portfolios show that an alternative firm should manage the NPLs and such firm that has no regulatory capital requirements as banks have.  In the case of |SAREB it has a portfolio of NPLs (real estate owned and real estate developments) which are identical to Cyprus and has been my choice from the summer of 2013.  The most attractive feature of SAREB is that it has a 15 year life span and hence ample time to recover NPLs unlike banks which face risks from regulatory changes or declines in real estate prices.

One might be right in asking so why is this such a good idea to get the economy to recover; there are several reasons.  These include the following:

  1. Banks would take a one off loss from sales of NPLs (NPLs of large borrowers) and then revert to lending as the banks would have to build their asset portfolio;
  2. The rates of interest would be lower since the good borrowers were paying for the delinquent borrowers and still do today.  This will not be necessary once banks have rid themselves of the NPLs;
  3. There could be foreign investment interest by firms who would see an opportunity to invest in real estate at discounted prices as we have seen in Ireland and Spain;
  4. The capital position of banks would be better with much less risk from a downside in real estate prices;
  5. The banks would not be vulnerable to legislators protecting borrowers as they have done recently which makes banks business hard to operate when they cannot foreclosure and hence will probably impact their provisions;
  6. The correction and recovery of the real estate market would be sharp and the market would find its equilibrium at a lower level.  Quite clearly the levels of 2007-09 were the result of a huge bubble which the banks funded and unlikely to be seen in the near future;
  7. The long term investment horizon of the asset manager will allow borrowers to recover rather than live under the threat of foreclosure, especially the distressed borrowers who are now “protected”. We will see how the long and bureaucratic process of the new legislation works out.

The above would have spillover benefits to the economy as foreign investment and the stabilsation of the real estate market at lower levels would provide the market with a renewed interest in investment.  So long as there is an overhang of property that can be sold it makes investment decisions put off which is the very essence of deflation and the worries of the ECB which led to quantitative easing.  Deflation in real estate prices has deleterious effects on banks’ balance sheets and this is why the situation as is at present should not continue.

It is noteworthy that the need for an asset management company to manage NPLs has come recently from the Chair of Hellenic Bank and now some politicians talk of a bad bank.  In my view the bad bank idea should be totally ignored since banks have regulatory capital needs and banks are not known to better manage such assets.  The option which the government and the Central Bank should consider is for specialist private firms with real estate expertise providing the majority of the equity required and the EUR1 billion, which remains unutilized as a buffer (pillow in Greek), to be used to fund an asset management company to acquire these NPLs.  The fact that Cyprus is within the single supervisory mechanism means the European Stability Mechanism can recapitalize banks directly for disposal of assets is in my view the best way forward since the losses banks face from selling at a discount the NPLs will have to be funded by new investment.  If the government can get the ECB to convert ELA to a 20 year loan this would be the icing on the cake.

Categories → Οικονομία

34 Comments
  1. avatar
    Kax on April 22, 2015 - (permalink)

    If money was no object fror the Government your suggestion would find many supporters.Afterall we have the examples you mention from Ireland and Spain.However as you point in reason 1 there will be a one off loss.Presumably new needs for capital will arise.Who will offer this capital ,on what terms?As you also point under reason 3 there could be foreign interest.Indeed there are many firms specialising in distress assets with huge capital,such as Oaktree and Cerberus.If a bank can sell the assets /or debt to this kind of firms at a price that makes sense no doubt it will do so.

    While I agree with you that the Government and its advisors should have seriously considered your proposal I am afraid we are now at a point of no return.Only if it proves impossible for banks to deal with the huge hedge funds and private equity firms and they are forced to look to other solutions then your proposal might be cosidered.In my opinion it is too late.We should get ready to welcome distressed debt firms and wait to see what the future will bring.

    • avatar
      Anonymous on April 22, 2015 - (permalink)

      I agree with KAX

      This option should have been examined 2 years ago before in order to to clear the banks from the burden of bad loans and let them work as normal banks as it happened in IRELAND AND SPAIN.

      Now after the investment/capital injection in BOC HB and Synergatiko going back to your suggestion will create new capital needs for the banking sector. Obviously our banks are still under provided thus the loss you be great.

      A solution would be to sell the NAB loans (related to Real Estate) directly to asset management companies that do specialise in distress loans thus increasing liquidity of banks and Capital adequacy.

    • avatar
      Anonymous on April 22, 2015 - (permalink)

      Furthermore the I billion buffer is not clearly enough to fund the asset management . Just consider that there are 25 billion non performing loans where 6 billion are 30 people and 2-3 billion are for normal first residence estates

      • avatar
        Erol Riza on April 22, 2015 - (permalink)

        The NPLs linked to real estate which would be suitable would be no more than 6-8 bln. Would you rather the banking system is under the threat of additional provisions and capital injections if the law on foreclosure is not what the banking system needs? The jury is out on the unintended consequence of the law and hope that the banking system is allowed to function efficiently

        • avatar
          Anonymous on April 23, 2015 - (permalink)

          I am just saying that 1 billion is not enough.

          Why should the government and the Cyprus people get more loans in bilions from the TROIKA to finance an asset management company??

          The lawmakers could make it available that the real estate NPLS to be sold to existing asset management companies which are out there.

          I would not trust the government to be able to manage such a complicated entity SO outsource it with min costs.

          • avatar
            Erol Riza on April 26, 2015 - (permalink)

            I think the capital should come from private sector as in other AMC. I agree the government should only be involved to the extent that the benefit from recovery should accrue to the Cyprus economy. If private capital can secured from institutional asset managers and or sovereign wealth funds it would be the best solution.

    • avatar
      Erol Riza on April 22, 2015 - (permalink)

      KAX
      You are correct in that there will be a need for new equity to cover the loss that will be incurred and this is covered in my proposal by direct recapitalization by the ESM which under its articles can do directly with banks so it is not public debt and where there is a disposal of assets. This was not possible before the SSM as such recap would have been done via the government and hence count as public debt. The timing is the best now.

  2. avatar
    TD on April 22, 2015 - (permalink)

    Converting ELA to a 20 year loan will just add to the Country’s debt with regard to GDP and will be shouldered by all taxpayers i.e. we will be adding around 7 Billion Euro (or 40% of our GDP) to our 18.8 Billion Euro debt when our GDP is 17.5 Billion Euro as per latest Eurostat results as at December 2014…so our debt to GDP will increase from 107% to 147%…So Personally I believe ELA should stay with the BoC and gradually it will be repaid when depositors return to the BoC…

    Other than that, although your idea of an Asset Management Company is correct from an Economics perspective there are various “political” reasons (realpolitik) usually found in Cyprus that will prevent the Asset Management Company from ever taking off the ground, despite the fact that the idea “technocratically speaking” is a good one:

    1. ETYK the bank workers trade union, although weaker, will not allow the vast majority of bank workers, currently working in the Debt Recovery and Arrears Management Units of: Bank of Cyprus, Co-op Central Bank and Hellenic Bank and the other Greek Subsidiary banks to be made redundant. As one Asset Management Company would not absorb all this staff, perhaps a third of the total number of staff would do, if it were to higher expensive bank employees at all…

    2. The current Shareholders of Bank of Cyprus: Wilbur Ross:TD Asset Management, Renova etc and Hellenic Bank: Daniel Loeb/Third Point LLC, would not want their shares in the banks they have invested in, to be RE-diluted, unless they are given preferential treatment in being shareholders of the Asset Management Company…They are hedge funds so as per your analysis are not investors that have a long term investment horizon…

    3. Political parties ESPECIALLY the one in government and the Archbishop are close to the big Borrowers and if their loans were dumped into an Asset Management Company they would face quite a bit of pressure to “lose” their development companies or private companies to foreign ownership or to lose their Assets to foreigners…

  3. avatar
    TD on April 22, 2015 - (permalink)

    Also Using the 1 Billion Euro buffer to fund the Asset Management Co would add to our debt to GDP by around 10% so all taxpayers including you and me would be more in the red because of it with potential upside in 15 years…

    • avatar
      TD on April 22, 2015 - (permalink)

      6 % to be precise

    • avatar
      Erol Riza on April 22, 2015 - (permalink)

      TD
      The ELA will remain with the BoC but instead of being emergency liquidity to be paid asap a 20 year loan to the BoC would find favour with all parties and in fact this is what happened in Ireland when the Promissory Notes issued by the Central Bank and where used as collateral for ELA were converted to 40 years. For this to happen one needs to win support in the ECB.
      As the for the large borrowers they will have time to get better recover if in a few years the price of real estate bonces sharply as in Ireland. The AMC will not have provisions or regulatory capital and given an investment horizon of 10-15 years the AMC can be a better place to park than in banks which have ended up being debt collectors or soon real estate banks.
      as for the existing investors who found “extreme value” they should have done their due diligence and have taken note of the idiosyncracy of the Cyprus real estate market. we are not the US, UK or Ireland where foreclosure is easy and courts are used to taking the side of the banks. In Cyprus the banks are on the defensive thanks to populist MPs and the best for the economy should be or concern. Investors such as the ones who have recapitalized BoC know when they risk their reward is not guaranteed.

      • avatar
        Μ on April 23, 2015 - (permalink)

        Mr Riza,

        According to my understanding, our case is not exactly the same. The promissory notes issued by the Irish Government were recapitalisation instruments and the main asset of the IBRC at the time. When the IBRC was liquidated, the promissory notes that were pledged as collateral to the CBI for ELA, were converted to long-term Government bonds and transferred to the CBI (the CBI agreed to orderly sell the bonds). As far as I understand the reason was that the Government would have had to repay the notes at maturity, as it is not a bank and therefore a roll over would have been a breach of monetary financing prohibition and therefore not an option (some say that the conversion was monetary financing as well). In our case the Cyprus Government bonds held by the BOCY are negligible in comparison to its total assets and much less than the ELA liability. Furthermore the ELA liability appears to be a short term obligation, which is (mostly) rolled-over. It appears that there is an understanding that ELA will not be fully repaid immediately and therefore implicitly, is a long term obligation.

      • avatar
        Μ on April 23, 2015 - (permalink)

        Mr Riza,

        According to my understanding, our case is not exactly the same. The promissory notes issued by the Irish Government were recapitalisation instruments and the main asset of the IBRC at the time. When the IBRC was liquidated, the promissory notes that were pledged as collateral to the CBI for ELA, were converted to long-term Government bonds and transferred to the CBI (the CBI agreed to orderly sell the bonds). As far as I understand the reason was that the Government would have had to repay the notes at maturity, as it is not a bank and therefore a roll over would have been a breach of monetary financing prohibition, hence it was not an option (some say that the conversion was monetary financing as well). In our case the Cyprus Government bonds held by the BOCY are negligible in comparison to its total assets and much less than the ELA liability. Furthermore the ELA liability appears to be a short term obligation, which is (mostly) rolled-over. It appears that there is an understanding that ELA will not be fully repaid immediately and therefore implicitly, is a long term obligation.

        • avatar
          Erol Riza on April 25, 2015 - (permalink)

          M
          You are quite right that the Irish ELA was different however the principle remains the same; I believe the ECB would like a roadmap that shows how the EA will be repaid but it is in my humble opinion better to have a long term obligation agreed than rolled over. It will allow the BoC to manage its funding cost better and thus its pricing. Deposit gathering in Cyprus is very competitive and unless the economy picks soon the rate increase of deposits will be stable. In these circumstances I feel a conversion of ELA into a long term loan would be good for the BoC and the economy at large. Unsecured issuance is not easy and only alternative is covered bond issues which will be more expensive.

  4. avatar
    The Invisible Hand on April 22, 2015 - (permalink)

    It is useful to look at some numbers. The November 2014 figures form CBC (latest I have seen) show that in all banks/coops there are approximately the following loans and NPL in billions::
    Corporate
    Construction 7.3 and 5.7
    Accomodation 2.3 and 1.4
    Real Estate 4.5 and 2.6
    Individuals
    Property/Housing 14.7 and 6.6
    This adds up to 16.3 billion property related NPL’s which does not include oetors of the economy with NPL’s which are likely secured by property.
    Any buyer of these distressed loans will be thinking of a 5 year investment horizon with an annualised IRR of 12% at least. He is unlikely to offer more than 30% of nominal value for these assets. Assuming the banks have already provisions of 30%, they will have to take an additional hit of 40% or 6.5 billion.
    I do not think Mr Loeb and Mr Ross will consider such a scheme.
    Please correct my numbers if I am wrong, it will make an interesting discussion.

    • avatar
      Erol Riza on April 22, 2015 - (permalink)

      If your numbers are right, and I have no reason to doubt, you feel it is best to park in the banking system with all the risks to the balance sheets.

      • avatar
        The Invisible Hand on April 23, 2015 - (permalink)

        I trust the judgement of Loeb and Ross more than the definitions about NPL’s by the CBC and the ECB or the Pimco guns-for-hire.
        I believe that the banks can recover at least some of their provisions by restructurings and equity for loan swaps, for which the BoC has already requested CBC approval to extend the 3 year rule for assets acquired.

  5. avatar
    Savvakis C Savvides on April 22, 2015 - (permalink)

    This may be necessary but not sufficient. It will not, on its own, solve the underlying reasons this Economy is suffering. It will not, for a start, begin to cure the fundamental problem of the gigantic private debt. It will not, on its own, foster conditions for economically viable projects. But it may be a step in the right direction. Although to be frank, I am not as certain as you seem to be on how easy it will be to fund and properly manage such a huge undertaking in Cyprus, especially without political and other interference.

    • avatar
      Erol Riza on April 23, 2015 - (permalink)

      Savva,

      Inaction when the NPLs were lower has made things worse for the banking system to revert to normal functioning. In most countries where there was a similar problem the governments acted swiftly, see Portugal with Banco Espirito Santo, and then allowed private equity to invest in real estate linked loans albeit at discounts upto 50%, whereas in Cyprus the NPLs have got worse and private equity is managing the banks. I have no problem with private equity managing as they certainly will do a better job. The real question for the banking system is where is it best to park the NPLs linked to real estate ( I mean the large borrowers). If this is addressed and the banks revert to lending, instead of deleveraging, there is a better chance for the economy. I feel the CEO of BoC was correct in his internal email and he is better placed to know how lawmakers make it difficult for a distressed bank to operate normally. An AMC, run by professional foreign investors, set up with EU support will have a long term horizon and hopefully immune to political interference.

  6. avatar
    Anonymous on April 22, 2015 - (permalink)

    Don’t need to raise capital or blow a hole in the bank balance sheets. its this shortsightedness / accountants thinking thats keeping in us in the hole.
    Give the project out to true financiers and get REIT legislation and funds tax law into shape. otherwise we are beating a dead horse

  7. avatar
    TD on April 23, 2015 - (permalink)

    Erol,

    Since you are concerned about ELA funding of €7 Billion as BoC liability and the NPL’s of all the banks which are €28 Billion, why don’t u marry your idea of Asset Management Company with the following:
    Tell the president and the MOF as well as the clever people on the CBC board to persuade the ECB to create a special purpose vehicle/asset man. Company that will not be a bank and subject to capital rules. Instead it’s assets (owned by the ECB) will be all the Cypriot NPL’s of 28 billion bought at a 75% discount of 7 Billion which is the ELA amount in this way ELA is removed from BOC balance sheet all the banks are deleveraged as their assets will shrink by 28 billion the only problem will be the cumulative accounting loss to their shareholders of 21 billion that will be the discount on the acquisition price of the NPL’s persuade the ECB to relax its common equity tier 1 ratio to include this loss as a DTA to add to the banks capital!! There is a bit of financial engineering you as an investment banker might find interesting and I give u the right to propose my idea as yours!!!

    • avatar
      Μ on April 25, 2015 - (permalink)

      TD,

      DTAs that rely on future profitability, shall be deducted from CET1 as per the provisions of article 36(1) of the CRR, subject to a phasing out period, which in case that the DTAs did not exist prior to 1 January 2014, is not that long. DTAs should be transformed into DTCs, which do not rely on future profitability in order to not be deducted from CET1. However that means that the banks will be able to claim that amount from the Government no matter what. Hence inflating the DTCs in an over leveraged banking system like ours, is likely to become a ticking bomb, which might be activated sooner than later, since the EU commission is investigating whether DTCs could be considered a state aid; Plus the residual capital shortfall should be covered anyway.

      An asset management company similar to NAMA (the state participates but the structure of the company enables NAMA to issue debt that is not considered to be part of the public sector) should have been introduced back in 2013. The resolution period could have been extended, until the AMC was formed, with the participation of the state and some other long term investors and the assets could have been transferred at a rational price; The haircut at the BOCY might was higher. It appears though that some were very keen to demonise the idea; After all for some: the banks were perfect, PIMCO inflated the capital shortfall, the loan portfolios of the banks weren’t toxic, some bad people wanted to take down our robust banking system and impose a higher haircut than needed etc etc etc. Now I believe that the new owners of the BOCY, would prefer to manage the NPLs of the bank (which will perpetuate uncertainty), instead of selling them at a huge discount and realise huge losses; Except if someone buys the assets at a price close to the carrying value.

  8. avatar
    TD on April 23, 2015 - (permalink)

    Also find a solution to the 7 Billion liquidity gap from the removed ELA from the BoC ie persuade Cypriots or Foreigners to deposit 7 billion in BoC…

    • avatar
      Erol Riza on April 25, 2015 - (permalink)

      TD

      Very challenging solution proposed indeed and I doubt I can answer in a satisfactory manner let alone propose to the President and the MOF.
      Nevertheless it is worth pointing some of the flaws in your reasoning.
      1. I have not suggested that all NPLs should be asset managed as you imply. The real problematic loans are real estate linked which need the time which a bank is not best entity to park these assets (Sareb has a 15 year life span). Hence the amount which I believe needs to be sold may not be greater than EUR10bln; in any case the potential investors will be interested to acquire loans which have a decent collateral; decent meaning that the location of the land or its size offers cope for viable development if an asset manager can hold out any additional price slippage. A bank is not the best entity to park these assets and I hope in this you will agree. Such loans will not have to e sold at the discount you suggest. Certainly the ECB is not a buyer of NPLs and this much you should know.
      2. The loss that will be crystallized is the difference between the NPL coverage in the form of provisions and the sale price. Even if the sale price were to be say 50% (for example) the banks could retain some upside by profit participation notes, subject to capital cost.
      3. I do not believe that I have the complete answer to the problem but I dare to express a view based on empirical analysis we have observed in other countries which are coming out of the crisis. Legislating to protect borrowers and having Parliament to demonise bankers does not help. The new investors have clearly no responsibility for mistakes of the past and the banks have to return to functioning as banks and lend. An AMC would assist in this direction otherwise the risk aversion of banks will continue and a high ratio of NPLs makes the cost of credit too high.
      4. ELA should be gradually repaid as loans are repaid and this is primarily linked to the economy’s trajectory. The overcollateralization of ELA with assets is sufficient and deposits are also linked with the growth in the economy. I think your suggestion is with tongue in cheek as they say!

  9. avatar
    Marios Zachariadis on April 29, 2015 - (permalink)

    It would certainly alleviate our problem if some assets were transferred off Banks balance sheets and into a more patient entity (bad bank/AMC). The key is pricing assets right. Below are some related points in the likely case Cyprus cannot get all the external transfers needed to finance a bad bank or AMC:
    A private bad bank buying assets at low price would open a large hole in banks that might necessitate public funds use. This is a likely event.
    On the other hand, a public AMC will tend to offer too high a price burdening taxpayers. It will also tend to be mismanaged &subject to political pressure. The last two will further increase the burden on Cypriot taxpayers. Overall, with either a private or public bad bank/AMC solution, the danger of (effectively) a BAILOUT AFTER the BAILIN we already witnessed two years ago, is quite visible. In any case, banks will have to do much more in getting things right (NPLs, payroll, attitude, customer hours, cutting off political links) before the taxpayer commits 1 more cent to support any of the above schemes.

    • avatar
      Erol Riza on April 30, 2015 - (permalink)

      Dear Marios,

      I believe the issue has been clarified by the Minister and there is no issue of public funds being used. Hence each bank will have to proceed and asset manage their NPLs as best as they can be that on or off balance sheet. As the banks have a better NPL coverage (should have been closer to 50% than 40%) there is a cost involved of selling outright without any upside for banks.
      In view of the need to have patient capital that will see recovery over a 7-10 year investment horizon it is such investors that one should hope would consider Cyprus as an investment destination. The success of the government to raise funds in the international markets and lifting of capital controls hopefully will be deemed as factors that hopefully will make an investment decision of institutional investors easier.
      I hope we agree that an economy with real estate NPLs is not such a good state of affairs and that banks themselves will consider what options they have.
      The QE has resulted in negative bond yields for some countries, including Poland’s recent Swiss bond issue. Hence there is no better timing to seek out investors when bond yields at an all time low. The yield on the 7 year issue will qualify for QE and hence the yield should contract and could be a useful for pricing purposes.

      • avatar
        Savvakis C Savvides on May 1, 2015 - (permalink)

        “The success of the government to raise funds in the international markets and lifting of capital controls hopefully will be deemed as factors that hopefully will make an investment decision of institutional investors easier.”

        Come on Erol, surely you know better than that!!! No serious investor would ignore the real issues about the economy and commit for the long term because our Government managed to stage a borrowing from the financial markets! Nor, would anyone be fooled by the lifting of the capital controls when the risks are far greater than any possible benefits from lifting them! I thought we agreed on all these issues in our oral discussions. Maybe I have misunderstood you.

        Moreover, I totally agree with Marios when he says “A private bad bank buying assets at low price would open a large hole in banks that might necessitate public funds use. This is a likely event”. The key is indeed not giveaway the loans at hugely discounted prices. The only “investors” interested in a stake in such scenario when the economy is faltering would be those after a quick profit at the expense of the tax payer.

    • avatar
      Savvakis C Savvides on April 30, 2015 - (permalink)

      Ditto! I agree. Transfer pricing is the key. Particularly, selling off to privately owned AMCs at hugely discounted prices is like giving away the crown jewels hoping that the problem will disappear or cease to exist! What will happen is that we will all be that much poorer (for the benefit of those who profit from it from selling these on at huge margins).

      • avatar
        Erol Riza on May 1, 2015 - (permalink)

        Savva,

        Never suggested to sell at hugely discounted prices. The big loans of banks are held by no more than 50 borrowers and in some cases the land used as collateral is prime property. It would be folly to sell at hugely discounted prices of say 20-30% which is what I imagine you have in mind. I feel that in the absence of a bank wide AMC each bank can chose to sell selected loans in packages or single sales and move such assets off balance sheet thereby mitigating risk. A true sale would be best but there can be other options and these can be discussed and structured with investors. We should welcome institutional investors who wish to take Cyprus risk and who would not want to make a good profit for taking such risk?

      • avatar
        Επιλήσμων on May 4, 2015 - (permalink)

        Αγαπητέ Σαββάκη,
        Σίγουρα κανένας πατριώτης δεν θα ήθελε και δεν θα δεχόταν να ξεπουλήσουμε σε εξευτελιστικές τιμές σε ξένους (ή και ντόπιους) τα πακέτα των ΜΕΔ που είναι συνδεδεμένα με μεγάλα ακίνητα. Να παρουσιάζουμε όμως αυτά τα ΜΕΔ ως να ήταν τα κοσμήματα του στέμματος (crown jewels) είναι κατά την γνώμη μου ελαφρώς παρατραβηγμένο.
        Δεν είμαι εκτιμητής ακινήτων αλλά έχω την υποψία ότι η πραγματική αξία πολλών ακινήτων δεν έχει καμιά σχέση με το ύψος του δανείου,(μιλούμεν πάντα γιά τα μεγάλα δάνεια).
        Δεν γνωρίζω εάν κάποιοι ευθύνονται γιά την παραχώρηση τέτοιων δανείων. Εάν δεν γνώριζα την τιμιότητα των συμπατριωτών μου και την απέχθεια τους προς την διαπλοκή, θα υποψιαζόμούν ότι πιθανόν κάποιοι να έδιναν και άλλοι να έπαιρναν μίζες.
        Παρεμπιπτόντως, μπορεί κάποιος να μου πει εάν στο παράδειγμα που ακολουθεί υπάρχει οτιδήποτε το μεμπτόν?
        “Σε κάποια μακρινή χώρα, συζητούσε ένας μεγαλοντεβέλοπερ με ένα μεγαλοτραπεζίτη γιά χρηματοδότηση ενός μεγάλου έργου. Ζητούσε δάνειο 50 εκατομμυρίων. Ο τραπεζίτης ήταν κάπως διστακτικός και στο τέλος ο ντεβέλοπερ του είπε -”ας συνεχίσουμε την κουβέντα μας αύριο Παρασκευή” – “Μα αύριο είναι Τετάρτη” – απαντά ο τραπεζίτης. -”Πας στοίχημα 100 χιλιάδες ότι αύριο είναι Παρασκευή?” – Δέχτηκε ο τραπεζίτης. Την επομένη συναντήθηκαν και ο ντεβέλοπερ έδωσε ένα χαρτοφύλακα (φάκελλο!) με 100 χιλιάδες στον τραπεζίτη, παραδεχόμενος ότι έχασε το στοίχημα. Ο τραπεζίτης πήρε τον χαρτοφύλακα με το αριστερό χέρι και έδωσε το δεξί γιά χειραψία και επισφράγιση της συμφωνίας παραχώρησης του δανείου.(Ενθυμούμενος πιθανόν καιτην Αγία Γραφή “Μή γνώτω η αριστερά σου τι ποιεί η δεξιά σου” Ματθ. στ’3).
        Σχετικά με το ύψος του επιτοκίου νομίζω ο φίλος Invisible πιθανόν να γνωρίζει καλύτερα από εμένα.
        Σημ. Το πιό πάνω είναι φανταστικόν και το ξεσήκωσα από ένα διήγημα.

        Όσο γιά τα crown jewels και τα υποθηκευμένα ακίνητα, δεν έχει στο τέλος και τόση σημασία εάν είναι μεγάλης αξίας, “prime property” όπως λέει πιό πάνω ο Erol (“φιλέτα” όπως συνήθως τα περιγράφει ο Αρχιεπίσκοπος) ή απλώς χωράφια με ασήμαντη αξία.
        Ως λαός έχουμε αδικηθεί κατ’ επανάληψη. Από μιά φούχτα συμπολιτών μας. Ας διατήρήσουμε τουλάχιστον την αξιοπρέπεια μας. Το ποίημα που ακολουθεί ελπίζω να βοηθά.

        . ΑΠΟ ΥΑΛΙ ΧΡΩΜΑΤΙΣΤΟ

        Πολύ με συγκινεί μιά λεπτομέρεια
        στην στέψιν,εν Βλαχέρναις,του Ιωάννη Καντακουζηνού
        και της Ειρήνης Ανδρονίκου Ασάν.
        Όπως δεν είχαν παρά λίγους πολυτίμους λίθους
        (του ταλαιπώρου κράτους μας ήταν μεγάλ’ η πτώχεια)
        φόρεσαν τεχνητούς. Ένα σωρό κομμάτια από υαλί,
        κόκκινα, πράσινα ή γαλάζια. Τίποτε
        το ταπεινόν ή το αναξιοπρεπές
        δεν έχουν κατ’ εμέ τα κομματάκια αυτά
        από υαλί χρωματιστό. Μοιάζουνε τουναντίον
        σαν μιά διαμαρτυρία θλιβερή
        κατά της άδικης κακομοιριάς των στεφομένων.
        Είναι τα σύμβολα του τι ήρμοζε να έχουν,
        του τι εξάπαντος ήταν ορθόν να έχουν
        στην στέψιν των ένας Κυρ Ιωάννης Καντακουζηνός,
        μιά Κυρία Ειρήνη Ανδρονίκου Ασάν.

        [1925] Κ. Καβάφης

        • avatar
          Savvakis C Savvides on May 5, 2015 - (permalink)

          “The best way to rob a bank is to own one”…R. Black

    • avatar
      Επιλήσμων on April 30, 2015 - (permalink)

      Συμφωνώ (ως συνήθως) σε όλα όσα αναφέρει πιό πάνω ο κ.Ζαχαριάδης.
      Έχω όμως να προσθέσω τα ακόλουθα.

      1.Από πότε ερωτήθη ο φορολογούμενος γιά το πως ξοδεύονται τα κρατικά χρήματα και θα ερωτηθεί σε αυτή την περίπτωση? (Και μην μου πείτε “στις εκλογές”).

      2. Γιά αυτά που αναφέρει ο κ. Ζαχαριάδης ότι πρέπει να κάνουν οι τράπεζες ως αναγκαίες και διορθωτικές ενέργειες, όλοι γνωρίζουμε ότι τίποτα από αυτά δεν θα γίνει. Τα ΜΕΔ θα αυξάνονται στα επόμενα χρόνια και πολλά (σχεδόν όλα) από αυτά που έχουν αναδιαρθρωθεί θα επανέλθουν σύντομα στην κατηγορία ΜΕΔ, εκτός και εάν κάποιοι πείσουν την κα Γιωρκάτζη (ή τον/την διάδοχό της) να αλλάξει ο ορισμός των NPLs και τα βάλουμεν στα 5-10 χρόνια – αντί 90 ημέρες. Μας έλεγαν ότι φταίει ο κ. Δημητριάδης γιά τις 90 ημέρες, τώρα που δεν είναι πλέον Διοικητής, γιατί δεν το αλλάζουν?
      Τα υπόλοιπα (payroll, attitude, customer hours, political links) είναι κεκτημένα και κατά την κυπριακή παράδοση, απαραβίαστα. …!

      Η θεωρία όμως (καθώς και η χρησιμότης στη δική μας περίπτωση) δημιουργίας μιάς AMC or BadBank, δεν την αμφισβητώ, και είναι κρίμα που αφήσαμε να περάσουν 2 χρόνια. Η δική μου άποψη είναι ότι έπρεπε να προχωρούσαμε στη δημιουργία BadBank κάτω από την Αρχή Εξυγίανσης και σε κατοπινό στάδιο η ΒΒ να μετατραπεί σε AMC.

      • avatar
        Erol Riza on May 2, 2015 - (permalink)

        Epilismon

        The NPLs under the new definition are definitely something which each bank has to address. The big issue though is that if you see the restructured loan terms which banks propose, or better impose, they are bound to revert to NPLs after restructuring. The terms of the restructured loans are not sustainable and the approach is wrong. The banks should learn from the Vienna Initiative and London approach that restructuring should be CONSENSUAL.
        The evidence hitherto is not good and there is a definite need for the Central bank to look into the pattern and nature of restructured loans. The new European banking Authority guideline to make restructured loans NPLs if after 30 days they face distress is yet another way of asking banks to make sure that sustainability is the way forward. This may mean that borrowers pay interest only for the next 2-3 years but so be it instead of debt repayments which cannot be met.
        One hopes that there will be more transparency and publicity on restructured loans so we better understand the course of the asset side of banks’ balance sheets.

        • avatar
          Επιλήσμων on May 4, 2015 - (permalink)

          Dear Erol,
          Completely agree with what you say. What I have said about the period of 5-10 years for NPLs was just to make the point (by exaggeration) that the vast majority of restructured loans would, sooner rather than later, revert to NPL status. And as you rightly point out, it is the TERMS that the Banks IMPOSE on the restructerd borrowers that create the problem.
          You are also correct to say that restructuring should be CONSENSUAL. If you were not a banker (at heart), perhaps you could have a gone one step further and suggest that a kind of ΣΕΙΣΑΧΘΕΙΑ is needed.

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