Greek reforms list proposes bad bank, lowers asset sales target

[ATHENS] Greece's government has proposed setting up a bad bank to deal with the rising level of bad loans and estimates it will raise a smaller than expected sum of about 1.5 billion euros (S$2.23 billion) from asset sales this year, a finance ministry official said on Monday.

The measures were included in a package of reforms submitted to euro zone lenders late last week in the hope of unlocking aid.

The reforms list also pledged to reduce early retirements to cut the burden on the country's tottering pension system but sought to avoid any tax hikes in the key tourism sector.

Athens' estimate of 1.5 billion euros in proceeds from privatisations this year is about 30 per cent less than the current target of 2.2 billion euros included in Greece's bailout programme.

The list also proposes the bad bank be set up with 10.9 billion euros in bank bailout funds that were returned to the eurozone last month.

REUTERS