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“Greek banks may need fresh recapitalization,” says Deputy PM Dragasakis

Deputy Prime Minister Giannis Dragasakis dropped a bombshell late on Thursday when he admitted that banks’ red loans may lead to fresh recapitalization for the Greek lender institutions.  “If there is no solution with the red loans we may lead banks to demand new capital that the Greek taxpayer will be called to pay,” Dragasakis revealed.

Drgasakis said the government has undertaken a series of initiatives to create a legislative  framework for the settlement of red loans, especially for indebted home owners. Lenders say solve the issue no matter what, “but we cannot do it.”

“We can not underestimate the fact that Greece is the country with the most red loans. So there are no manual solutions, there is no manual to deal with the problem. If we do not pay attention, we can make arrangements to lead banks to a point where new funds are needed. And that is why the legislation has not been completed yet.”

Dragasakis said the legislation may come towards end of February or beginning of March.

According to some media, the four Greek systemic banks lost another 13.53% of their value in January, all four banks are worth 3.68 billion euros.

Despite pressure by the lenders, Greece has not solved the issue yet.

At the Eurogroup Working Group (EWG) on Thursday, sources told media, that “Greece has not completed the implementation of all the prior actions agreed.” However, there is still time before the next Eurogroup on March 11, when finance ministers are to make the final decision.

Areas where there are delays include the Katseli law for protection of indebted home owners, the repayment of public sector arrears and electronic auctions. The discussion also touched on the increase in the minimum wage, which was included in the institutions’ report.

sources: amna, capital, newsit

PS More recapitalization paid by the taxpayer?” I’m terribly sorry, I don’t think that I will be able to contribute to this with 1 cent after 9 years of economic crisis for which I have already paid with what I had and had not for the sake of all those who lent and borrowed as if there was no tomorrow.

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