By N. Malliara
Auctions of foreclosed properties offered up by Greek lenders will now be under the closer scrutiny of the Single Supervisory Mechanism (SSM), top Greek bankers were told this week during a meeting in Frankfurt with SSM supervisory board chairwoman Danièle Nouy and ECB executive board member Benoît Coeuré.
The Greek delegation, in fact, was headed by Bank of Greece (BoG) Gov. Yannis Stournaras.
The message out of Frankfurt is that the course of property auctions will be decisive in determining Greek banks' capitalization condition.
Along those lines, the SSM aims to closely follow auctions and prices offered by properties, so that the latter do not significant deviate from the values of collateral written on banks' spread sheets.
According to reports, deviations of between 20 to 35 percent are judged as risky for banks' capital adequacy.