Bankruptcy
Out-of-court settlement applications double
The number of new applications submitted by debtors to the platform for the out-of-court settlement mechanism reached 7,360 in February.
The number of new applications in February was more than double the number of applications in previous months - the average in 2023 was 3,400 new applications per month - and is a record high, according to a Finance Ministry announcement on Friday.
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Cyprus banks must increase restructurings
The governor of the Central Bank of Cyprus has dispatched crucial correspondence to banks and credit repurchase companies shedding light on the strategy for restructuring nonperforming loans (NPLs) and navigating credit risk management.
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Auctions avoided with advance payment of 10% of debt
A new boost is expected for the out-of-court mechanism for debt settlement, after the improvement regulations incorporated in the new law passed on Tuesday by Parliament.
An amendment provides that creditors are given the possibility to request an advance payment of up to 10% of the debt, as shown by the calculation tool of the extrajudicial mechanism.
Carrot and stick for more debt settlements
The government is using a carrot-and-stick approach to increase debt settlements through the out-of-court mechanism: It is tightening penalties in cases of noncompliance through provisions to be included in a bill to be tabled in Parliament around end-September.
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No more leniency for social security debtors
Individuals and businesses who are due a tax rebate but owe money to the Unified Social Security Fund (EFKA) will see their rebates offset with their debts, may no longer be able to submit their statements to EFKA online and may be prosecuted.
All these moves are part of the social security debt collection center's plan to crack down on debt and prevent its further accumulation.
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Debt settlements to banks, state at €2.65 bln
A total of €2.65 billion in private debt to banks - or, more accurately, to the recovery funds that bought delinquent loans from banks - and the state has been settled so far this year outside the courts, through 7,257 cases, the Ministry of Finance announced.
Of those, 931 settlements worth €400 million were made in July alone, the ministry added.
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Is debt settlement faltering?
One in every three debtors who apply for out-of-court debt settlement reject the terms they are offered resulting from the platform's algorithm. Most of them claim that the terms are too harsh, while a significant number estimate that it is not in their interest, so the government is understood to be considering new interventions.
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Investor sought for fish farming giant
Creditor banks are searching for a new buyer for the scheme created under the name Avramar, specifically for the fish farming company's activities in Greece, five years after the sale of Selonda and Nireus to the Andromeda aquaculture group.
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Large debtors on the ascent
About 70% of total overdue debts to the tax authorities comes from businesses, according to the Independent Authority for Public Revenue (AADE) data analyzed by the Parliament Budget Office.
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Criteria for settling debts
The tax authorities are right to help those who find it difficult to meet their obligations. But before allowing them to enter a debt repayment scheme, they must first assess those debtors.
Those who were found to be in debt due to weakness and those who have been caught actively evading taxes cannot be treated in the same way.
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