Sale Price For NPL Secured Assets

The 2013 banking crisis brought to light the serious issue of Cyprus banks carrying on their balance sheets substantial provisions for non-performing loans (NPLs) which adversely affected the banking sector's profitability and sustainability. In response to EU pressure, the government of Cyprus put considerable effort into tackling the problem of NPLs, implementing various measures including improved foreclosure legislation and measures to assist banks to restructure their loan portfolios.

As a result, Cyprus has seen a large increase in enforcement proceedings, undertaken by credit institutions holding security on various assets, which has resulted in courts increasingly being required to deal with the material issue of whether the security holder has an obligation or duty to the debtor to sell the secured assets at the best possible price.