Greece reaches deal with lenders over reforms unlocking stalled aid: Minister

ATHENS - Reuters

An elderly man walks past Greek flags on sale in central Athens, on October 29, 2015. AFP Photo

Greece reached an agreement with its lenders on financial reforms early on Nov. 17, its finance minister said, removing a major obstacle holding up fresh bailout loans for the cash-starved country.

Athens signed up to a new aid program worth up to 86 billion euros earlier this year, but payment of part of an initial tranche had been held up over disagreement on regulations on home foreclosures and handling tax arrears to the state.

“There was an agreement on all the milestones ... whatever was required,” Finance Minister Euclid Tsakalotos told reporters after meeting representatives of European institutions and the International Monetary Fund (IMF) on aid disbursement.

Tsakalotos said the deal meant Greece’s parliament could now ratify the set of reforms to law, and that deputy eurozone finance ministers, known as the Euro Working Group, would on Nov. 20 endorse the deal.

That would allow a two billion euros ($2.15 billion) aid disbursement and about 10 billion in recapitalization aid to the country’s four main banks, he said.

Greece has been keen to complete its first assessment under the new bailout package, its third since 2010, so it can start talks with lenders on debt relief.

Talks had previously stalled on disagreement over the level of protection for primary residences of homeowners unable to pay their mortgages, the repayment of tax and pension fund arrears and revenues from value-added tax.

A government official said earlier that the deal provided foreclosure protection for primary residences for about 60 percent of mortgages among an estimated 400,000 homeowners whose loans had soured.

About 25 percent of that group, who were families with incomes below the poverty line, were accorded protection from foreclosure, and the remaining were given foreclosure protection for a three-year period provided they restructured their debts with their banks.

“This is the first time a social safety net has been created to protect the poor and the unemployed,” the official said.