The non-performing exposure (NPE) ratio of Greek banks is very high (49% in June 2016), the second highest in the euro area, after Cyprus. Its reduction is a key precondition for gradually restoring an adequate and efficient supply of credit to the Greek economy, and for achieving sustained growth. Some important legislative reforms in this direction have already been passed.
For instance, the household insolvency law was amended to ensure that banks can take legal steps against strategic defaulters and that debtors make payments in line with their ability to pay. And the Code of Conduct of the Bank of Greece provides guidelines on the interaction between banks and debtors in arrears.