EDEK seems to have second thoughts on linking the sales with the approval of the state budget of 2021. According to information, EDEK MPs Kostis Efstathiou and Elias Myrianthous may not finally submit the bill for tomorrow in the plenary session change the framework for sales.
READ ALSO: The revised Budget increased by € 339.91 million.
The two MPs had initially set the change of the law as a condition to give their positive vote on the budget. The bill, co-signed by Solidarity MP Michalis Giorgallas, gives debtors the opportunity to go to court to claim the true balance of their debt, the legality of the mortgage and the suspension of the sale.
Although EDEK does not open its papers on what it will do in the end regarding the sales, information from F “states that it may return the issue to the Parliament in the coming weeks, in order to promote arrangements that satisfy all the political parties. As we have been told, the government has been pressing EDEK to put the bill aside, as it is being evaluated by the Moody's and a change in the sales framework may have provoked reactions from the house.
EDEK, however, is waiting for the government's answers to the four issues that remain open in relation to the budget. A competent source stated that the government has satisfied the majority of the requests of EDEK, which after the withdrawal for the sales will probably maintain a positive attitude towards the budget. In such a case, together with the positive votes from DISY, Solidarity, the Cooperation of Democratic Forces, the Alliance and ELAM, the budget will be approved.
Four “no” Petridis
Meanwhile, in a letter sent by the Minister of Finance Konstantinos Petridis to the Parliament, he clarifies that the issues related to the sales and the GESS can not be accepted. As we wrote yesterday, EDEK requests the establishment of a special court for financial cases, so that the borrowers who disagree with the over-indebtedness of the banks can resort to it and until the trial of the case the suspension of the sale process is suspended.
The Minister of Finance notes in his letter that the period for exercising the right of borrowers to appeal to the court for the freezing of sales for old loans, ie those that are in the process of sale, has already expired. In relation to the new cases, ie for those for which there is no court decision and a sale process has not started, as Mr. Petridis points out, the affected parties have the right, based on the new sale framework, to appeal to the Financial Commissioner to dispute the amount and if justified they can suspend the sale until the bank implements the decision of the Commissioner. As the Minister points out, the new framework for the sales, which has been in place since last summer, although it has not been tested in practice, adequately guarantees the rights of borrowers.
On the issue of the establishment of a special court, the President of the Republic Nikos Anastasiadis had placed at the meeting of the leaders last Friday, who rejected the creation of such a court. However, he said there could be settlements with the Supreme Court and district courts.
Regarding the other proposal of EDEK, which stipulates that, firstly, a bank must demand from all guarantors an equal amount and not selectively address to whichever guarantor the bank wants and, secondly, in case the guarantor is not Mr. Petridis points out that his share to be absorbed by the bank while he is alive or in bankruptcy, points out that a legislation that will limit the existing liability of the guarantor is an interference with the creditor's right to contract and will be considered unconstitutional.
Meanwhile, the minister points out that the constitutionality of a regulation that will prohibit from now on the signing of a guarantee agreement by a natural person, which provides that the responsibility for repayment of the loan amount is indivisible and in solidarity with other natural persons . According to Mr. Petridis, such an arrangement would have an impact on new loan concessions, which are not secured by real estate. Indicates that the application of the measure to existing loans will be unconstitutional. Finally, the ministry agrees to amend the law, so that the amount per guarantor is divided into new loan agreements.
No change for GESS and the sale of loans
The government also turned red on EDEK's suggestions related to GESS. As pointed out in the letter of the Minister of Finance to the Parliament, these proposals are not accepted, as they affect the philosophy of the single insurance plan. According to the Minister of Finance, the National Recovery Plan includes measures for the upgrading of infrastructure and the supply of state-of-the-art medical equipment, totaling € 78.5 million. of emergency throughout Cyprus, strengthening of Makarios Hospital, the construction of a special COVID unit at the Famagusta hospital and the creation of a communicable diseases unit at the Limassol hospital.
Furthermore, in relation to the request, based on which the borrower will have the first say in the purchase of the loan before its sale to a loan repurchase company, with EDEK setting the price at 50-55% of its value, the ministry notes that by law the first borrowers have the right to buy their loan within 45 days. According to the Minister, the sale of a credit facility portfolio takes into account the cumulative consolidation effect of removing red loans from the bank's balance sheet, to arrive at prices for each loan category. Indicates that in negotiations with each borrower the bank can not be forced to offer a price, which is part of an overall settlement. This, he emphasizes, would end the secondary loan market in Cyprus, which contributed to the reduction of NPLs.
Accepted the cross of salaries of associates of the President
With increased appropriations by € 339.9 million is the revised budget sent yesterday by the Ministry of Finance to Parliament, to begin its elaboration by the Finance Committee and to be put to a vote in an extraordinary plenary session on Monday 18 January. The budget included appropriations of € 200 million, in the context of the need to support businesses and self-employed, due to the implementation of new measures to address the ongoing pandemic. Credits of € 20 million were also included for the provision of support and the wider stimulation of the economy, an amount of € 200 thousand for the purchase of services in relation to the treatment of non-performing loans, an amount which as noted is reduced by 10% according to relevant amendment, as well as another € 120 thousand for the purchase of services for the operation of the citizen telephone service center for the services offered by the welfare allowance management service. The budget also incorporated 23 party amendments, which were approved on December 17th. Among other things, the government accepted spending cuts of € 21.4 million. Specifically, a 10% cut was made in the funds for consulting services, for operating expenses as well as for the funds for staff training.