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Greek notaries held electronic auctions for two repossessed properties on Wednesday, ending a six-month stand-off with the country’s bailout creditors over efforts to accelerate the reduction of an unsustainably high level of non-performing loans in the country’s banking system.
The first e-auctions prompted strong reactions from those on the far left including former officials in the governing Syriza party.
Riot police guarded the offices of notaries participating in the scheme. Protesters gathered outside one notary office in central Athens shouting: “This law [on e-auctions] will remain on paper, it will not go further.”
Notaries in Athens and the Greek islands suspended a two-month strike under pressure from the government, but the walkout continued in the rest of the country.
Another 17 auctions of properties outside the capital planned to take place this week have been put on hold, according to an official at the notaries’ association.
Bailout monitors from the EU and the International Monetary Fund made clear that the current review of progress with fiscal and structural reforms could not be completed on schedule next month unless e-auctions of repossessed properties were taking place regularly.
“The notaries’ strike became a potential deal-breaker for the review,” said one government official.
From a slow start this year, with only a handful of sales expected next month, banks expect the pace of auctions to accelerate in the first quarter of 2018 to around 600-700 weekly.
The first properties on the block were a cluster of parking slots and a luxury home in an Athens suburb offered at half its official valuation, one notary said.
Holiday homes and properties belonging to owners classified by the banks as strategic defaulters are being given priority by the banks. Auctions of first homes valued at less than €300,000 are expected to take place at a later date out of consideration for hard-pressed families.
Around 18,000 properties are due to be sold at auction next year, but in a severely depressed Greek property market, some bankers doubt whether the creditors’ target can be met.
Greek banks are struggling to reduce some €100bn of non-performing exposures equal to 45 per cent of total lending. The country’s central bank has set a target of a €67bn reduction by 2020.