for private debt management has improved via a number of reforms such as : • the acceleration of liquidation of banks ’ collateral via electronic auctions • the simplification of the process of loan sales via the liberalisation of the npl management regime and the creation of a secondary market for npls 3 / 5 bis central bankers'speeches • the out - of - court workout ( ocw ) of private debts, including the possibility of tax obligation writeoffs ( up to now, however, only few cases have been resolved using this method ) • the modernisation of the insolvency regime for households and firms which is under way and is expected to be applied by the government in the first semester of 2020 according to available data for the first nine months of 2019, npls were 71 billion euros or 42, 1 % of total loans. despite the fact that the economy returned to positive growth rates in 2017, positive credit expansion is necessary for higher and sustainable growth rates. a presumption for this is to clear the banks ’ balance sheets from npls, in addition to the restructuring of private debt. the four systemic banks have agreed with the ecb / ssm ambitious targets for the reduction of npls, while the less systemic ones have agreed similar targets with the bank of greece. according to these targets, the npl ratio is expected to fall below 20 % until the end of 2021. however, even if these targets are achieved, the npl ratio in greece will be five times higher than the corresponding european average. hence, it is imperative to apply additional systemic solutions, complementary to the efforts of banks, for the rapid improvement of the quality of their assets. in this context, dg comp approved project hercules, which is based on an asset protection scheme ( aps ) through state guarantees to the senior tranche of the ensuing securitization of about 30 billion of banks ’ npls. this scheme which has been approved by parliament last december, is an important step forward. however, given the size of the npl problem, more schemes are expected to follow, later on and after project hercules has produced results. such a scheme could be the one proposed in the recent past by the bank of greece, which, along with the npl problem, it also deals with the issue of capital quality due to the high share of deferred tax credit ( dtc ) in greek banks ’ capital. capital ratios ( common equity tier 1 ) of greek banks are satisfactory

( defined as aggregate own funds of the firms in this survey as a percentage of aggregate scr ) was 150 % as at ye2016 and 156 % as at ye2017. for definitions of the market variables, see https : / / www. bankofengland. co. uk / / media / boe / files / prudential - regulation / regulatory - reporting / insurance / market - risk - sensitivities - instructions. pdf. more specifically, the impact of 20 % of assets by market value downgrading from the current credit quality step ( cqs ) to the next cqs. a cqs refers to rating agency ratings. all speeches are available online at www. bankofengland. co. uk / speeches typically hedge the risk margin. for insurance liabilities written before the introduction of solvency ii, the risk margin can however be offset by transitional measures on technical provisions ( tmtp ), which allow any increases in reserves due to the introduction of new solvency ii requirements, such as the risk margin, to be phased in over sixteen years. insurers can therefore partially reverse any deterioration in their capital position due to a higher risk margin if interest rates fall by applying to the pra to recalculate their tmtp upwards. for example, tmtp recalculation would have reduced the decrease in aggregate capital surplus following a 100bps fall in interest rates by about two thirds as at end - 2017. conversely, if the risk margin falls because of an increase in interest rates, the pra may require recalculation so that tmtp is not overstated. % change in surplus ( excluding any tmtp recalculation chart 4 : aggregate market risk sensitivities for uk life insurers 50 % aggregate market risk sensitivities for uk life insurers ye16 ye17 25 % 0 % - 25 % - 50 % source : aggregated uk life insurers market risk sensitivity submissions some individual insurers have published many of these market risk sensitivities. but the pattern is inconsistent across firms. i held a roundtable with insurance analysts and investors on disclosure around a year ago. i took away that they find solvency ii disclosures more useful than accounting disclosures, at least in the current state of insurance accounting. and a consistent set of such sensitivities was near the top of their disclosure wish list. i hope