News Column

Disagreements over foreclosures bill

July 21, 2014



The government's foreclosures bill was yet to be finalised as the Finance ministry is still in talks with the Troika of international lenders (European Central Bank, European Commission and International Monetary Fund) over some of the controversial provisions that would allow banks to foreclose insolvent borrowers' properties.

Negotiations are ongoing at a technocratic level, with the focus being on striking the appropriate balance between the rights of borrowers and lenders.

A meeting between the Finance minister and the Troika's Cyprus mission heads to reach agreement has yet to be scheduled, but Georgiades and Interior minister Sokratis Hasikos, along with Attorney General Kostas Clerides, met at the Finance ministry on Monday noon to discuss the contested provisions.

"The issue has reached its high point," Hasikos said, entering the meeting.

As the bill has acquired 'prior action' status meaning it needs to have been passed before the next tranche of international aid to Cyprus can be released the government had planned for it to be ready for Legal Services to review and submit to the Council of Ministers by Wednesday.

The bill would then be forwarded to parliamentary parties for review, ahead of voting at an extraordinary House plenary session before September's Eurogroup that would decide on approving the next aid tranche. This planning required the bill to have been finalised by Tuesday, but deadlines are nearing and agreement on the final text has yet to be reached.

The Cyprus News Agency reported on Monday that the bone of contention was a clause allowing the borrower to appeal the foreclosure process in court, a provision not acceptable by the Troika as it was deemed to make the process more time-consuming.

The government also insists on borrowers being allowed an active role in determining the value of their property collateral also not acceptable to the Troika.

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Source: Cyprus Mail


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