Here’s the thing about Greece: Some of those dark, foreboding, black storm clouds looming over the Acropolis have a faint glimmer to them. But this being Greece, those apparently silver linings have a not insignificant amount of lead within. To wit: Today, the Bank of Greece said the country’s banks were doing a better-than-expected job of getting out from under the colossal mountain of bad loans that are crushing it’s economy’s chest while Angela Merkel’s grip on its throat gets tighter and tighter. Since the Greek economic crisis is scheduled to last until the end of time, Greek banks were supposed to lighten their load of €106.9 billion in non-performing exposures by all of €1.7 billion over the past year, at which rate the backlog would be cleared just in time for Tante Angie’s 124th birthday. But guess what? Greek banks didn’t cut their NPEs by €1.7 billion. They cut them by €3 billion!
While NPEs soared to 106.9 billion or 50.5 percent at the end of June last year, banks trimmed the figure to 103.9 billion euros, excluding off-balance sheet items, in the first three months of the year, beating a target of 105.2 billion….
"Despite the still strong formation of new NPEs, especially in the first two months of the year, banks managed to reduce them further mainly as a result of writedowns amounting to 1.3 billion euros," the central bank said.
This almost sounds like good news, and combined with the IMF’s apparent decision to start fighting for Greece, amounts to the country’s first winning streak since the ancient Olympics ended in the fourth century. This sounds too good to be true, certainly to Prime Minister Alexis Tsipras' ears, and it of course is.
The IMF believes Greece needs significant debt relief, which Germany rejects. Lagarde suggested agreeing a deal whereby the IMF would stay on board in the bailout, as Berlin wants, but not pay out further aid until debt relief measures are clarified.
Syriza's political committee, in which Prime Minister Alexis Tsipras and his finance minister participated on Tuesday, said the proposal pushed back decisions and "does not contribute positively in the direction of finding an honorable and commonly accepted solution."