GREECE Trends and Developments Contributed by: Paris Tzoumas, Zepos & Yannopoulos
aligning with the digital preferences of younger, tech-savvy customers in Greece. Against this backdrop, the local market saw the merger of Attica Bank into Pancreta Bank in early September 2024, creating the fifth-largest lender in Greece in terms of estimated balance-sheet assets – a transaction that followed the absorp - tion of HSBC Greece’s operations by Pancreta Pursuant to Greece’s National Recovery and Resilience Plan (“Greece 2.0”) and the imple - mentation of Greek ministerial decisions, the projects and investment plans of companies/ investors that fall within one of the following the - matic pillars are eligible to be financed through the Greek banking system by a combination of commercial loan facilities and RRF facilities. • the green transition; • digital transformation; • novelty, R&D; • development of economies of scale through cooperations and M&A; and • extroversion (which also includes the tourism sector). Bank earlier in July 2023. Legislative Developments RRF loans Each of the Greek banks have signed so-called “operational agreements” with the Greek gov - ernment – ie, agreements through which the Greek State on-lends monies to the commer - cial banks (stemming from the EU Recovery and Resilience Fund (approved by the EU council post-Covid crisis) for these banks use to fund eligible investment projects. The operational agreements contain the minimum set of obliga - tions and protections that the Greek commer - cial banks will have to fulfil (as primary lenders) for the relevant borrowers as part of the facility
agreements entered into to safeguard the due repayment of the RRF funds made available. Pursuant to the operational agreements and the relevant ministerial decisions, an eligible invest - ment project can be financed for up to a maxi - mum of 50% of its eligible investment budget by virtue of these RRF loans, while equity funds and commercial loan facilities made available from Greek banks should cover at least 20% and 30% of the eligible investment budget, respec - tively. The commercial loan facilities that finance part of the eligible investment costs are referred to as “co-financing facilities”. To the extent that certain costs are not eligible from an RRF per - spective, these can be financed by additional and separate facilities made available by Greek banks and referred to as “non-eligible facilities”. The law provides that RRF facilities and co- financing facilities must, at all times, rank pari passu in terms of both repayment profile and in terms of the security package collateralis - ing their payment profile. In principle, this rule does not affect non-eligible facilities, which must, however, be clearly segregated from the RRF and co-financing facilities, even if they are all part of the same facility agreement with the respective borrower. In terms of interest rates, the RRF facilities can benefit from very low rates determined by vir - tue of ministerial decisions which set minimum interest rates (currently 0.35% for small and very small enterprises and 1% for any other enter - prises). Note that that minimum interest rates will, in principle, constitute state aid for relevant borrowers, and so their compliance as such with maximum acceptable limits for state aid should be tested (this is particularly important in cases where eligible investments have also been also subsidised by the Greek state under other appli -
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