george a provopoulos : the impact of climate change in greece opening address by mr george a provopoulos, governor of the bank of greece, at the presentation of the report of the climate change impacts study committee, athens, 1 june 2011. * * * first, i wish to welcome you and thank you for attending today ’ s event, which will present the results of an ambitious initiative undertaken by the bank of greece, namely a study of the economic, social and environmental impact of climate change in the case of greece. as you all know, environmental issues are not usually a matter of concern to central banks, whose principal mission is to safeguard monetary stability. it has been my view, however, that environmental themes deserve more attention, especially in a country not accustomed to studying issues of a long - term nature. when the bank of greece, nearly two years ago, announced its initiative to set up a study committee, the need for action to deal with the impact of climate change was urgent, though not as much as it is today. in the course of these two years, we have all witnessed the ongoing change in the climate and its significant impact at the global level, but also an economic crisis that prevents us from understanding the long - term benefits of investment aimed at adaptation to climate change. with the release of this report, the bank of greece, in line with its broader role and its tradition of studying the structural problems of the greek economy, helps fill a gap as regards scientific analysis and information on climate change, on its impact and on ways of dealing with it. this report represents a first attempt at a comprehensive study of the impact of climate change for greece – in particular of the cost of climate change that would be borne by the economy, the cost of implementing adaptation measures, as well as the cost of moving to a low - emissions economy, in the context of the global effort to mitigate climate change. for the first time and for close to two years, this project brought together teams from different scientific disciplines ; the teams included physicists of the atmosphere, climatologists and geophysicists, experts in agriculture, forestry and fisheries, as well as experts on water resources, tourism, the built environment and energy, not to mention economists and sociologists. the findings of the study document the need for greece to shield itself from the risks of climate change and to adopt an appropriate long - term strategy. the climate changes, as they unfold, affect and will continue to

contraction of the deposit base ) an obstacle to the financing of the economy and to the fulfilment of banks ’ intermediation role. a welcome development is that several steps have been taken in the area of legislation and regulation, but also action on the part of banks to address the problem. the most recent developments concern : the regulatory framework for the authorisation and supervision of credit servicing and credit acquiring firms ; the modernisation of bankruptcy law ; the shift of banks to long - term workout solutions and the requirement that banks meet specific operational targets in terms of non - performing loan management. the target is for non - performing loans to be reduced by nearly €40 billion by end - 2019. most of this reduction is expected to come from the corporate loan portfolio. the achievement of the overall target will rely initially on long - term forbearance and resolution and closure solutions, selective write - offs and collateral realisation, while loan sales should be brought into play mainly from 2019 onward. however, reaching this target will also require that several legal and other pending issues be addressed such as : ( a ) out - of - court settlement ; ( b ) the legal protection of bank, public entity and special liquidations staff involved in corporate debt restructuring processes ; ( c ) the accounting / tax treatment of losses arising from loan sales or write - offs ; and ( d ) the establishment of an electronic auction system. these pending matters, coupled with the uncertainty associated with the slow progress of negotiations with the institutions on the completion of the second review, pose a risk to the attainment of the above target. although the volume of non - performing loans declined in 2016, january 2017 apparently saw a pick - up in new non - performing exposures and a drop in borrowers ’ responsiveness to offered workout solutions. meanwhile, the situation once again seems to be favourable to strategic defaulters, since deliberate default on loan obligations does not incur the prescribed sanctions. against this background, reducing non - performing loans is imperative, all the more so given its multiplier effects both on banks and on the real economy : banks would benefit from higher asset quality, higher liquidity, lower financial risk and hence lower funding costs ; this would translate into higher loan supply, as well as demand ; and ultimately a restructuring of the economy ’ s production model through the freeing - up of resources for financing productive investment. turning to the private insurance sector, the main developments in 2016 concerned the transposition into greek law of the solve