Deal to spare homes up to 300,000 euros from auctions is only for a limited period

Brussels and Frankfurt were displeased on Thursday to learn of statements by Deputy Prime Minister Yiannis Dragasakis and Finance Minister Euclid Tsakalotos on Wednesday, according to which there is a deal between the government and the banks that no homes valued at less than 300,000 euros should be sold at foreclosure auctions.

"If there is such an agreement, if it is a binding one, it should be taken into account in the upcoming stress tests, as in practice it cancels the collateral that concerns properties worth less than 300,000 euros," a European official told Kathimerini.

The issue blew up yesterday at the European Central Bank as the ministerial statements coincided with what the head of the Hellenic Bank Association said on the matter: Nikolaos Karamouzis told the Financial Times that Greek lenders had coordinated their plans to make sure that homes valued below...