Vanishing Cyprus: banks bailout – the big lie!

Andreas Chrysafis
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6

IF BANKS LOANED money at their own risk, there would be far less reprehensible moneymaking in the world today. Unfortunately that is not the case!

Convinced that the banks had all the answers to the ever-increasing socio-economic problems, governments have endorsed the banking establishment to set up the rules of trade-practice. Consequently, bankers ensured that those rules exonerate them from any social responsibility other than to make money out of nothing. In the final analysis, this powerful super-elite sector of society has become untouchable!

The theory behind those decisions was based on the principle that: if banks make profits they will lend money to companies and individuals in order to purchase homes, goods and services; start new businesses and develop the manufacturing industry, which subsequently will produce many jobs and people can live in comfort and pay their share of taxes to the treasury; the nation will then function efficiently while people can spend the remainder of their hard-earned cash to buy consumer goods to create and generate wealth distribution. Under those terms everyone is a winner… just like magic – prosperity and security for all! The Big Lie!

The result of this “free market principle” sponsored by the banking establishment, it has enabled banks to exercise absolute financial dominance by way of international monetary cartels and monopolization over the supply of credit and money. As Sir Josiah Stamp, – director of the Bank of England 1928-1941 and the 2nd richest man in England – said: “if you want to continue to be slaves of the banks and pay the cost of your own slavery, then let bankers continue to create money and control credit. Take this great power away from them, for then, this world would be a better and happier world to live in.”

In fact, those calculating cartels have blatantly abused the free market principle through sheer greed enhanced by the failure of governments to effectively regulate and hold those companies responsible for their actions. Today, banks not only control governments but they have successfully “colonized” entire continents through debts and virtual loans! They have now become supranational masters of the world!

Gone are the days when coin dealers spread their coins on banca (benches) – hence the word “banks” – to make transactions atop counters covered by green tablecloths! Everything was visible and transparent! If dealers were caught cheating they would be severely punished or lynched!

In modern times, banking institutions operate quite differently; not only they operate without transparency or accountability but they also operate on the borderline of criminality. They have been known to deal with drug-money, money laundering, the financing of weapons (to both warring factions to kill one another) and other dubious transaction activities.

Their greatest financial wizardry ever conceived through deviousness, could be none other than the invention of mortgage, where citizens are enslaved until death to pay off a property loan.  This word is a French law-term meaning “death contract”. It implies that the pledge ends (dies) when either the obligation is fulfilled or the property is repossessed through foreclosure. When an original amount of a loan, ends costing the consumer four or five times as much on interest payments, such a practice can only be considered a legalized extortion. Sir J. Stamp warned: the terms of such a facility can only cause financial slavery!

The Rothschild Group of Bankers such as Goldman Sachs, Neuberger Bergman and others, have played an active role recently in reducing nations to near bankruptcy. Gambling with other peoples’ money has produced amazing profits for them but it has also sparked off economic chaos across the world. The result of this unprecedented financial crisis triggered by speculating on high-risk investments has caused millions of people to lose their homes in the United States and in Europe. Yet, no government has ever held banks responsible for their sleight of hand. On the contrary, they are prepared to bail them out of trouble.

Economically starved governments borrow billions from Troika lenders (IMF, World Bank, ECB) and then hand over those billions directly back to banks, as a gift! Since the borrower needs to compensate the lender, governments in despair have no option but to accept crippling bailout preconditions specified by the Troika lenders. They normally call for the initiation of severe austerity programmes such as tax rises and punitive taxation; reduction of salaries and public spending; cutting down on social services and benefits, raid pension funds as well as layoff of thousands of employees. The result of those cold austere measures – which so far have proven to be ineffective – has caused the ruin of millions of lives across Europe, especially in Greece.

The new buzzword today is: colonial capitalism! This is achieved not through acts of war but from decisions taken behind opulent desks and through virtual loans and virtual capital executed at the click of a button. Those supranational corporations have wittingly established an economic web such no economist can truly unravel how those markets work. They have become so complicated they confuse even the brightest financial wizards.

Wealth creation is meant to be the result of real production of goods and services, and not due to the gambling speculation of freeloading investment bankers. However, their influence on society cannot be underestimated and they certainly play a pivotal role in the free market principle but that power should not be to the detriment of everything else. It is this freedom to: the right to profit through the abuse of privileged power as opposed to; the right profit within the boundaries of fairness in a society that needs to be addressed!

Cyprus has not escaped this dark financial cloud of misery that has fallen upon the nation. Through bad management, today the country is in dire straits and its credit rating has been reduced to junk status B3 making it impossible to borrow money on the international markets. Due to its negative outlook and profound economic difficulties, no lenders are prepared to come to its rescue; hence the ominous Troika invite! Figures as high as 20 billion Euros have been circulating amongst analysts that the government must borrow to bail out the banks and itself out of the crisis.

It is not the responsibility of the taxpayer to bail out failed banks; that is the responsibility of their own shareholders!

Iceland was one of those countries that ignored all banking warnings of “economic doomsday scenarios” and dire straits. She refused to make the public pay the price of a bailout and the Icelandic government let the banks go bust! Nobel Prize-winner US economist Paul Krugman wrote in the New York Times. “Where everyone else was fixated on trying to placate international investors, Iceland imposed temporary controls on the movement of capital to give itself room to manoeuvre”.  He also warned against the notion that adopting the Euro can protect against economic imbalances.

Iceland’s economy and banking system today has recovered and experiences a steady growth due to the fact that it controls its borders, its own krona currency and interest rates. By adopting the euro, Cyprus is trapped and does not have that luxury. One day, it may be necessary to pull out of the euro to regain its social and economic independence. The “one-size-fits-all” policy did not work for most EU member states. In fact it ruined many economies!

It would have been more prudent for Cyprus to follow the Icelandic example and allow the banks to go bust rather impose a stranglehold on the nation and taxing citizens to death. Rising taxation can only add to the crisis and stagnate growth at times where it’s desperately needed the most!  There were other measures at hand to deal with the crisis such as: bank takeover or apply restrictions on the transfer of assets abroad through the imposition of capital control. Iceland, Britain and Cyprus (in the past) have done so with great success. It should have also gone after tax fraudsters; dealt with tax avoidance worth billions; collected the millions from developers owed to the state and explore other available measures.

Unfortunately, for political expediency the government failed to act in time and chose the easy option: to borrow billions from Troika and force the taxpayer to pay for it! In doing so, the next government will inherit the biggest debt ever accrued in the history of Cyprus and will take an economic miracle to ride the storm.

Consequently, it is necessary to re-examine the entire banking system in Cyprus and introduce new strict laws and conditions in support of consumers and not the financial institutions. No bank should have the right to gamble with their depositor’s money and solid guarantees must be put in place to protect depositors and avoid a similar situation from ever happening again.

At the end of the day, which government has the foresight and vision to deal with the banking system… prosecute when necessary and do the right thing?

Author of:
WHO SHALL GOVERN CYPRUS – Brussels or Nicosia? -Political analysis
ANDARTES – a revolutionary riveting novel
PORPHYRA in PURPLE – a metaphysical spellbinding novel

All books are available from: Bookshops, Barnes & Noble, Amazon.co.uk, Amazon.com, Waterstone’s, Kindle and the Internet.

Other articles can be found on Google under “Vanishing Cyprus” or “Andreas C Chrysafis”.

Property law loophole losing tax revenue millions

Nigel Howarth
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4

cyprus tax liability
IN A RECENT interview with the media House Speaker and leader of EDEK, Yiannakis Omirou, said that tax evasion was a crime against the people of Cyprus especially under today’s circumstances.

He assured reporters that EDEK is ready to vote in additional legislation to stamp out tax evasion.

I wonder if Mr Omirou is aware of the loophole in the property laws that enable people to reduce their property tax liability by not having their Title Deeds updated when they erect a building on their land? Is he and his party prepared to stamp it out?

Here’s how the loophole works

I should say from the outset that if you have already bought a house you will not be able to benefit from this loophole.

  • The first thing you need to do is buy a plot of land with a Title Deed. Let us say that this costs you €75,000.
  • You pay the Property Transfer Fees of €2,250 at which time you the secure legal, undisputed ownership of the land and everything on it. The Title Deed will show the assessed 1980 value of the land – let us say it is €7,500.
  • You then build a house on the land, making sure that you obtain all the necessary permissions and permits for the construction to be carried out within the law. Let’s say the house costs you €325,000 to build.
  • Once the house is completed, it is inspected by the Planning Authority and is issued with its Certificate of Final Approval.

The land and the house together cost you a total of €400,000 and you can now live in it safe in the knowledge that you have complied fully with the law.

However, unlike many other countries, in Cyprus there is no legal requirement to add your house to the Title Deed (a process that costs around €60). Indeed, if you were ‘foolish’ enough to do so, there are financial consequences:

  • The Land Registry will reassess the 1980 value of your property, which could increase to possibly €60,000 – and as the local property tax you pay to your Community, Municipality, etc. is based on the 1980 value of the property, you will pay more in local taxes each year.
  • Also, if you built a particularly large and luxurious house and it’s 1980 exceeded €120,000, you would also make yourself liable Immovable Property Tax to the Inland Revenue Department. (The Government has proposed reducing the threshold at which this tax becomes payable from €120,000 to €40,000. So even if you have a relatively modest home, you could make yourself liable for this tax).

Makes fraud much harder to uncover

Not registering a house on a Title Deed also makes fraudulent transactions more difficult to uncover – and gives you a competitive advantage should you sell.

  • As the Land Registry does not know that a house is built on your land, you could sell the land and the house for (say) €500,000. €400,000 of this would be paid in cash (‘black money’) and the balance of €100,000 would be the declared sale price on your contract of sale.
  • The Land Registry would probably look at this contract and decide the market value was correct. You paid €75,000 for the land and sold it for €100,000 making a profit of €25,000. But you would need to pay Capital Gains Tax on the chargeable gain. Taking the Capital Gains Tax allowances into consideration, this would be no more than €1,600.
  • Your buyer would also benefit as he would pay Property Transfer Fees based on declared sale price of €100,000 – these would amount to €3,291.40.
  • Had you registered your house on the Title Deed and the sale price declared in the contract of sale was only €100,000, a fraudulent transaction would be easier to spot.

Furthermore, if you and your buyer were honest and the sale price declared in the contract of sale was €500,000 (without any ‘black money’ changing hands), your Capital Gains Tax liability could be in the region of €16,500, while the Property Transfer Fees paid by your purchaser would amount to a massive €33,165.59.

How much tax revenue is being lost?

A well-known authority on local property matters said he suspected that 50% of private buildings/houses were not registered (on the Title Deed) in his newspaper column.

How much the government and local authorities are losing through this loophole in the legislation is anyone’s guess. But if half the private buildings/houses have not been registered on the Title Deed, the annual loss must amount to many millions of Euros.

The troika must insist that Cyprus changes its antediluvian property laws to maximise tax revenue before it starts insisting that banks should sell of people’s homes that they have paid for in full!

Are you up to it Mr Omirou (and troika)?

Credible counter proposal needed on bank seizures

Editorial
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4

THE GOVERNMENT obviously recognises the huge social problems that would be created by the troika’s proposal for the seizure and sale by the banks of properties used as security for non-performing loans (NPL). The troika suggested that after 18 months of the owner not making loan repayments, the property should be repossessed by the bank and sold. 

“There are some sensitive issues of mainly social nature for which the government has political positions,” said the government spokesman Stefanos Stefanou on Wednesday. He said these positions would be forwarded to the party leaders so the matter would be discussed at their scheduled meeting with President Christofias on Monday.

The Cyprus government is obviously worried that such a measure would result in hundreds, if not thousands, of families losing their homes. With more and more people out of work, there is bound to be an increasing number who would be unable to pay their instalments on housing loans. And with the recession set to continue for the next two years at least, such a measure would have devastating social consequences.

In the past, it took a bank between eight to 11 years to repossess a house for which the owner was not repaying the loan. Even if the court issued a repossession order, the case stalled at the Land Surveys Department which would take years to process it. If the troika proposal is imposed new legislation would have to be passed, speeding up the whole procedure, but it is more than likely that the political parties would try to delay approval.

The government’s counter-proposal is that the 18-month period suggested by the troika be extended to five years, while repossession of houses in which the owner was living would be ruled out. Troika technocrats will have a laugh when they see these counter-proposals, which essentially would be an admission by the government that it opposes the rule of law. How else could the suggestion that legal contracts regarding housing loans did not have to be honoured, be interpreted? The government is saying that a home-owner can refuse to repay his or her loan to the bank indefinitely and with impunity.

Nobody would like to see people who are hard up being thrown out of their homes, but the government’s position is a blatant show of disregard for the law, that would encourage cheating and dishonesty. If someone will face no consequences for not repaying a housing loan, why pay it? If it wants to protect home-owners from eviction it should come up with an arrangement, within the law. One suggestion was the setting up of a state company that would take over housing loans, but this would incur significant costs for the taxpayer.

As for the extension of the troika’s proposed 18 months, for the repossession of collateral on NPLs, to five years it is absurd. If someone is not repaying his loan on a holiday villa or if a business cannot meet its loan obligations for office premises or a high-street shop, why should the banks wait for five years to repossess? In a country with rule of law, legal contracts cannot be made invalid because of the government’s social policy, regardless of how worthy its objective might be.

There is another big social issue, relating to the troika’s proposal that nobody has touched – the tens of thousands of innocent property owners without title deeds. What would happen to them if the developer, who was paid in full for the property but re-mortgaged it, has NPLs and the bank, which holds the title deed, repossesses property?  Would the government sit and watch as an owner, who has done nothing wrong, is evicted from a house for which he has paid in full, because the developer cannot repay his bank loans?  There are over 100,000 people, the majority foreigners, without title deeds for properties they had bought and paid off. Would they be protected by the Cyprus government’s five-year proposal that would buy time for developers, in the hope they would eventually be able to repay their loans?

The troika’s proposal relating to NPLs is based on the rational economic approach that ensures the efficient allocation of resources and eliminates market distortions, but takes no account of the social implications. It would certainly have dire social consequences, which is why the government must formulate a credible counter-proposal, aimed at providing a safety net for genuinely hard-up, house-owners as well as those who have paid for their properties and have no title deeds. This might be a costly exercise, but it would be the rational and responsible approach, infinitely better than the government advocating disregard for legal contracts.

Title Deed mess must be considered by troika

Nathan Morley
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4

THE NEED TO ADDRESS the Title Deeds fiasco is more urgent than it has ever been as the troika move in to sort out the banks’ non­performing loan (NPL) port­folios, property experts have said.

The Cyprus Property Ac­tion Group CPAG, said that through dealing with some terrible buyer situations, the organisation had seen much of this coming.

“As most of us have been saying for quite a while this Title Deed mess will need to be drastically addressed at some time; however the longer this action is delayed the more risky it gets for an increas­ing number of buyers due to developers’ rapidly reducing ability to service their mort­gage debts,” CPAG said.

In a document titled “The economic adjustment pro­gram for Cyprus“, the troika of lenders wants local banks to repossess homes held against non-performing loans within 18 months, opening the possi­bility that some homeowners without Title Deeds could po­tentially face the seizure and sale of their properties.

The Cyprus government, in its counter proposals to the troika, wants a five-year stay pending seizure of a property. Moreover, it proposes that owner-occupied housing be exempted from any asset sei­zures.

Whatever the outcome, it is certain that a compromise will have to be made under the bailout negotiations, which will still leave thou­sands of home buyers without Title Deeds facing reposses­sion of their properties due to developer mortgage defaults, unless the age-old fiasco is fi­nally resolved.

Spells disaster for many

“The troika’s proposal to ac­celerate loan recovery by the banks could spell disaster for many,” property analyst Ni­gel Howarth told the Sunday Mail.

“Within 18 months they could lose their homes even though they may have paid their developer in full and have been living in the property for many years.”

Howarth stressed that the news provides little com­fort for tens of thousands of homeowners who have been left without deeds by developers that used them as collateral for their own mortgages.

“We know that many people, both Cypriot and foreigners, have been duped into buying property built on land that the developer has mortgaged to the bank,” he said.

“We also believe that many developers’ loans should be considered as non-performing because they are not getting sufficient revenue from sales to service their loans.”

Furthermore, Howarth added that many banks were woefully deficient and reck­less in their responsibility to clients by granting mortgages to people that had unknow­ingly bought property on land which developers had already mortgaged.

Extent of the deceit is unknown

“But we do not know the ex­tent of the deceit, which this and previous governments have condoned by their inac­tion, but it must affect many thousands of people,” he add­ed.

“It is only when those who have bought property do a ti­tle search from the Land Reg­istry that they discover that the land on which their prop­erty is built is mortgaged. But even then they cannot find out the balance of the mort­gage as the bank treats this information as confidential.”

It is estimated that developers have sold properties without Title Deeds – the documents proving ownership – to 70,000 Cypriots and over 30,000 for­eigners, with the banks having first priority on the properties when calling loans.

CPAG claims that develop­er mortgages have now reached a staggering €6 billion.

“And developers currently in a collapsed market with limited income and unable to service this debt (and with the banks having hidden these NPLs) this ‘toxic debt’ we have been highlighting for years becomes even more tox­ic every day,” it said.

“Unfortunately, we are now seeing a possible avalanche of other creditor claims against retained Title Deeds on prop­erties paid for in full, often years ago.”

Homeowners chased by banks

CPAG said some unfortunate buyers have found out already by accident that their homes are scheduled to be sold off in order to pay off their bankrupt developer’s debts – not only to the banks but to the many other creditors, including the Inland Revenue, who have since come out of the wood­work and also lodged claims against the Title Deeds.

“And by the way, what claim does the bank now re­ally have, even over the land, when it was part of a decep­tion from the outset and has not acted properly in respect of the management of the de­veloper’s debt on that land?” it added.

CPAG also wondered what chance there was of the troi­ka either uncovering or being told the real extent of the Title Deeds mess.

“Questions do remain,” said Howarth. “How will the banks treat home buyers who are diligently making their mortgage repayments? Will the banks throw them out on the street if their developer defaults?”

“I dearly hope that the troika’s investigations will have uncovered the deceitful practices of the developers, their ‘puppet’ lawyers and the banks.

“Hopefully, in their forth­coming discussions with the government the troika will put forward measures to pro­tect home buyers from what could otherwise be their Ar­mageddon.”

Anti-Euro MP Nigel Farage says the troika’s economic policy toward Cyprus would result in wide-spread misery for both Cypriots and expatri­ates in on the island.

The outspoken MEP has pre­viously condemned the prac­tice of retaining title-deeds after the sale of a property, asking whether Cyprus was ‘a state or a bandit-stronghold?’

The Title Deed fiasco has been a constant embarrass­ment to the government and is partly blamed for the slump in the once booming property market, with Interior Minister Eleni Mavrou recently admit­ting that her office has been made aware of hundreds of complaints about deeds being sent to EU officials in Brus­sels.

The Cyprus Title Deed mess must be considered by troika

How much do Title Deeds cost?

Nigel Howarth
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5
How much do Title Deeds cost?

HOW much do Title Deeds cost? – the simple answer is €0.85 – and copies may be purchased from the District Lands Office in which the property is situated.

However, the question should be “what will it cost me to secure legal, undisputed ownership of a property?”

In Cyprus, and many other countries, those buying property are required to pay a government tax to secure legal, undisputed ownership of a property. In Cyprus this tax called ‘Property Transfer Fees’; in the UK it is called ‘Stamp Duty Land Tax’ (SDLT). In both countries the tax is payable each time a property is purchased – and it is paid by the buyer to the relevant government authority.

In Cyprus, Property Transfer Fees are based on the market value of a property at its date of sale, assuming that the stamped contract of sale was deposited at the relevant District Lands Office within the required timescale. The Fees are calculated on a sliding scale as follows:

3% – on the first € 85,430

5% – on the next € 85,430

8% – on the remainder

So for a home with a market value of €200,000, the Property Transfer Fees would be €9,165.59; for a home valued at €400,000, the Transfer Fees would be €25,165.59.

If a property is purchased in joint names (e.g. a husband and wife), the Property Transfer Fees are calculated as if they had each bought a property of half the value.

So, for a home valued at €200,000 bought in joint names, a couple would each pay €3,291.40 making the total Property Transfer Fees payable €6,582.80. If the couple bought a property valued at €400,000, their combined Transfer Fees would total €18,331.90.

Property Transfer Fees can be calculated online by visiting the Cyprus Department of Lands and Surveys – Transfer Fees Calculator.

Are Title Deeds worth the added expense?

MOST CERTAINLY! Some people tell me that they are not prepared to pay for their Title Deeds (as they put it). These people, in my opinion, are extremely foolish.

Why?

Because without paying the Property Transfer Fees to secure legal, undisputed ownership of a property you have purchased, you face several problems:

  • Once you have paid the Property Transfer Fees and the Title Deed to the property has been registered in your name, it is no longer owned by the developer. So if the development company fails and a firm of liquidators is appointed to sell off the company’s assets, they will not be able to throw you out of your home – or chase you for payment of the developer’s debts.
  • If, sometime in the future, you decide that you want to ‘purchase your deeds’, the vendor/property developer could make things difficult for you (remember that he will have been paying all the central and local government taxes that rightfully you should have been paying as he will still be the legal owner of the property). You may end up having to take legal advice and possibly get involved in expensive litigation to secure ownership your home.
  • Selling property in Cyprus at present is very difficult due to the state of the island’s economy, massive oversupply of unsold properties flooding the market, developer insolvencies, etc. Unless you have the Title Deed to the property you have purchased, finding a buyer will be even harder as the cat is out of the bag with regard to the widely publicised Title Deed-cum-fraud fiasco.
  • Then there are the troika’s proposals. As you may have read, the troika wants banks to maximize their recovery rates for non-performing loans and to seize property pledged as collateral against these loans and offer it for sale within 18 months. Although this may not affect you directly, it could push some developers into insolvency – and then you could be faced with the problem of dealing with the liquidator as I mentioned earlier.

If you want to sleep easy at night in absolute confidence that no-one can take your property away from you or chase you for money to keep it, pay your Property Transfer Fees as soon as you are notified that your Title Deeds are available and secure its legal, undisputed ownership.

Homeowners need protection from troika proposals

Elias Hazou
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15

THE GOVERNMENT has countered the troika’s pro­posal for the seizure and sale of properties held against bad loans after a period of 18 months, stating that it wants to protect residential property dwellers.

In its economic adjustment programme for Cyprus, un­der the heading ‘Regulation and supervision for banks and cooperative credit insti­tutions,’ the troika advised that “strong efforts should be made to maximise bank recovery rates for non-per­forming loans, while minimis­ing the incentives for strategic defaults by borrowers.”

It proposed that “the ad­ministrative hurdles and leg­islative framework currently constraining the seizure and sale of loan collateral will be amended such that the prop­erty pledged as collateral can be seized and offered for sale within a maximum time-span of 1.5 years.”

In addition, “the procedures guiding the repossession of cash and other financial as­sets, which are not pledged as collateral and are held by de­ faulted borrowers outside the lending institution, should be appropriately accelerated; taking into account also the possibility of moving these assets within and outside the banking sector.”

But the government wants to extend the period to five years. It proposes that owner-occupied housing be exempt­ed from any asset seizures. That would still affect assets such as inherited property, second homes, or land plots.

A major sticking point is the troika’s proposal for a redefi­nition of banks’ non-perform­ing loans (NPLs), which if ac­cepted would cause Cyprus’ bailout figure to soar. They propose that “the Central Bank of Cyprus’ guidance on the classification of loans as non-performing be immedi­ately amended to include all loans past due by more than 90 days.”

The government’s counter­proposal on seizures, part of its ‘file’ on credit institutions, was leaked to the media with­in hours of being handed to political parties. Central Bank sources said the number of properties seized by banks over the last few years is sta­tistically negligible.

That’s because the process ends up at the Land Registry Department, which typically informs a bank that due to its huge backlog it will take the bank a long time to gain pos­session.

Cyprus Property Action Group comment

UNDER the troika’s pro­posal, there would be an increased risk for all those people without title deeds losing their proper­ties where developers who have non-performing loans (NPLs) lose their collateral and it goes to the banks. An estimated 130,000 title deeds are pending.

But according to Dennis O’Hare, head and founder of the Cyprus Property Ac­tion Group (CPAG), there is more to it than meets the eye.

He said: “The troika doesn’t understand the situation. They are going about it in a similar way as they dealt with collat­eral in Spain and Ireland. There, the developers built properties with bank mort­gages which they have been unable to offload. The key difference in Cyprus is that developers have taken out mortgages on properties and sold them to other peo­ple.”

O’Hare said that if a de­veloper here goes bust, it is not just banks which stake a claim on the property: “Other creditors come out of the woodwork, like the Inland Revenue Depart­ment, the VAT Service, and so on.”

“At the end of the day, be­cause of all these claims, the amount of debt on title deeds grows to about three to four times the value of the asset, including the bricks and mortar. With the troika’s proposal, since all the other claims would also have to be satisfied, at the end of the day the banks would get back only a small percentage of their invest­ment.”

CPAG cites the ratings agency Standard and Poor’s noting that the bail­out package from the EU being negotiated would be in excess of €15 billion, with €6.5 billion required for the banking sector, mostly for recapitalization.

“We are afraid that the ratings agencies don’t know the half of it,” CPAG says on its website.

O’Hare has this take: “Were the government to accept the troika’s pro­posal, it would expose the whole rotten system. And I believe that’s why they are trying to leave out owner-occupied lodging from bank seizures.”

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