By N. Malliara
Greece’s “Olympus-sized” mountain of bad debt and a looming commencement of electronic property auctions dominated a meeting in Washington on Thursday between the leadership of the Hellenic Bank Association (HBA), which represents Greece’s lenders, with the IMF’s Europe chief Poul Thomsen and the Fund’s mission chief for Greece, Delia Velculescu.
The meeting comes after Greek bankers’ representatives met with IMF Managing Director Christine Lagarde in London earlier this month, and also comes after a very high-profile compromise between the Fund and European creditors over the need for an asset quality review (AQR) and earlier “stress tests” for Greece’s four systemic banks.
Lagarde already told the Greek side that clear indications of progress to reduce NPLs and NPEs is necessary in the coming period. Beyond verbal promises, the IMF wants a “road map” for reducing non-performing loans in order to avoid the need for an AQR of Greek banks.
European creditors had balked at the Fund’s insistence for an AQR on Greek banks, a demand aired after the summer.
The HBA delegation was led by its president Nikos Karamouzis, who is also the president of Eurobank.