Greece’s Ministry of National Economy and Finance has published a package of 16 proposed measures that would impose binding rules on bilateral debt restructuring and strengthen the transparency, supervision and accountability of credit servicers. Eight measures cover debtor protections, including fixed negotiation deadlines, a 15% cap on upfront payments and safeguards against enforcement while a borrower complies with an active arrangement. The other eight would expand servicer disclosures, reporting, audits and sanctions. A new standardized bilateral restructuring process would replace the Code of Conduct. Creditors would have three months to offer a viable arrangement or provide a written, substantiated rejection, while the entire process would have to conclude within six months. Proposals must reflect the debtor’s income, assets and repayment capacity, with feasible alternatives presented where available. Three months before an auction, creditors would have to provide a suitable, viable and documented restructuring proposal. Debtors would also be entitled to free, detailed account information within 45 days, with interest suspended until full information is provided if the deadline is missed. The package would reactivate a statutory cap on total debt for loans and credit at least 90 days overdue and extend vulnerable debtor status to parents or legal carers of dependent children with a certified disability of at least 67%. Enforcement action taken against a borrower complying with an active arrangement would be automatically void. The borrower would receive a credit equal to five monthly installments and a five-month interest-free extension, while the creditor could face a fine of EUR 50,000 to EUR 500,000. Servicers would have to publish annual information on their finances, governance, portfolios, performance and borrower complaints, and submit annual debt-management strategies to the Bank of Greece. Additional measures include mandatory servicer involvement in secondary-market loan sales, annual independent audits of securitizations backed by Greek state guarantees, publication of sanctions and explicit ministry oversight of disclosures on the Non-Performing Loan Electronic Platform.
Greece’s Ministry of National Economy and Finance unveils 16 measures to strengthen debtor protections and servicer oversight
Greece’s Ministry of National Economy and Finance has unveiled 16 proposed measures tightening bilateral debt restructuring rules and servicer oversight. The package sets three- and six-month negotiation deadlines, caps upfront payments at 15% and protects borrowers who comply with active arrangements. Servicers would face broader disclosure, planning and audit requirements, stronger sanctions and increased supervision.