House accepts one referral on foreclosures, rejects another
The House of Representatives adopted one of the two referrals relating to foreclosures by President Nicos Anastasiades but rejected the other.
The implementation of the bill on foreclosures is a precondition for the disbursement of the sixth tranche of about 440 mln euros in financial assistance from the Troika of international lenders.
The Troika wants to introduce measures that would make foreclosures easier in order to help banks recover nonperforming loans and reduce their asset-based risk. The political parties, however, embarked on a populist crusade to defend the rights of borrowers, at the time that the government insists that these rights are safeguarded through a separate bill on insolvencies.
The referral which was accepted in Parliament on Tuesday by a majority of 28 in favour, 24 against and 4 abstentions, was on legislation initially tabled by MPs stipulating that borrowers have the right to submit a complaint to the Central Bank of Cyprus on violations by banks of the code of conduct governing restructuring of loans.
The second referral, which was rejected unanimously, concerned legislation which gives the Central Bank the power to intervene in cases of mass foreclosure. The plenary then adopted by majority an amended proposal on the matter.
Ruling party DISY President Averof Neofytou had proposed to have consultations with the European Central Bank on the first referral. He also spoke of the need to create conditions for growth and attract investments and criticised banks for sending out multiple letters to borrowers and guarantors at a time when an effort is underway for parliamentary consensus on the matter.
Ppposition AKEL Secretary General Andros Kyprianou criticised the government and the President for the way the whole affair was handled and said his party would table a legislative proposal calling for suspension of the legislation on foreclosures.
He further expressed his party’s readiness to discuss directly with Finance Minister Harris Georgiades the legal framework on insolvencies which is being drafted with the participation of experts nominated by all parliamentary parties, except AKEL.
Former coalition partner DIKO MP Angelos Votsis said things would be different if Parliament had before it all the bills relating to insolvencies. The government has pledged to draft the bills and submit them before the end of the year.
Socialist EDEK MP Nicos Nicolaides said the legislation adopted by Parliament and referred back to it by the President aims to protect citizens. He noted that in order for the current problem to be resolved, the Parliament must insist and continue to seek alternative solutions.
Greens MP Giorgos Perdikis said he will reject both referrals, adding that they lack constitutional and political reasoning and aim to satisfy the whims of the Troika.
Citizens Alliance MP Nicos Koutsou said he will reject the referral on the Central Bank because it is not justified by way of constitutional violation but rather by the argument that such a provision already exists in other legislation in force.