Athens Digest 29.11.2018

• Dombrovskis open to idea of SPV

• Bloomberg: Rule change on loan sales would help Greece, Italy

• Piraeus, Alpha say no merger talks planned

# EU Commission Vice-President Valdis Dombrovskis says EU authorities are open to the idea of Greece creating a disposal fund for soured bank loans but noted discussions are still in the early stages. Speaking to the Greek financial news website, the commissioner praised progress that had been made in Greece, adding however that further improvements were necessary. He made the remarks just ahead of presenting a Commission report on non-performing loans across the bloc. It noted that gross non-performing loans and advances as a percentage of the total in Greece were at 44.9 percent in the second quarter, down from 46.9 percent a year ago, while the current EU average (Q2 2018) is just 3.4 percent. It also refers to a.potential set-up of a European NPL transaction platform.

# European Union regulations on disposing of NPLs could soon be eased, helping lenders in Greece and Italy deal with their bad-debt mountains. Bloomberg reported, citing a draft of the proposed changes, that banks would be given additional options designed the limit the need for more capital after a major NPL sale. The plan, according to the report, would apply to banks that sold more than 20 percent of their bad debt.

# Greece’s Piraeus Bank and Alpha Bank have denied a report that they are considering a merger. “We would like to inform the investment community that (Piraeus Bank) is not currently discussing or contemplating any merger transaction with Alpha Bank or any other banking institution,” Piraeus Bank said. The statement, it said, was issued in response to a query by the Hellenic Capital Markets Commission. Alpha Bank also issued a statement denying that there was any truth to the merger-talks claims.

On our Radar: 130 pawn shops used as front for smugglers of crisis-era gold
As Greeks flocked to pawn shops during the financial crisis to sell the family gold, a group of wealthy businessmen used a nationwide network of stores to feed a multi-million euro smuggling operation. Police said a 130-store network was linked to two criminal organisations that melted-and-recasted gold and smuggled it to Turkey on tour buses taking Greek holiday-makers to Istanbul for tax-free resale. Police seized nearly EUR 2 million worth in jewells, gold and cash, along with firearms and other valuables following multiple raids on stores and properties. Sixty-three people were arrested and at least 20 more are wanted for arrest or questioning.