Greece: Swiss franc loans in practice and banking ethics

Posted on 31/05/2016 · Posted in Articles, Cyprus, Greece
  • During 2006-2008 many Greek domestic banks granted to Greek customers loans denominated in Swiss Francs

  • Latelly Greek courts are annulling the abusive clauses of CHF Loans

During 2006-2008 many Greek domestic banks (Alpha bank, Eurobank, Bank of Peireus, National Bank of Greece) granted to Greek customers loans denominated in Swiss Francs.

As in other European Countries, the reason was that at that years Euribor was quite high and as a result mortgages connected with that interest rate were expensive and therefore less attractive to customers. It is not a coincidence that at that specific period (2006-2007) LIBOR (London Interbank offered Rate) was lower and thus cheaper to market it. The banks also advertised that mortgages denominated in Swiss francs were more stable and there was no risk at all. But, as the jurist Evangelos Moshopoulos says “What they have not explained though, was that in reality those signing these contract were gambling their house in the fluctuation between Euro and Swiss franc which in fact changed rapidly at the expense of people .

The contracts were standard forms with pre-written terms on behalf of the bank whereby the customer did not have opportunity to negotiate. He just signed them without knowing that by doing so he had to burden the extra cost of repaying the mortgage, due to the fact that the capital went up again after the rate between Euro and Swiss franc changed considerably against Euro.

On the other side, our Greek representative, Evi Avlogiari, send us 2 articles about FX loans (PDF1 + PDF 2) that allow us to understand much better how this kind of loans work and the risk for the families. Evi Avlogiari will be with us next 7th June in Brussels to share the problematic of CHF Loans in Greek and Cyprus and also in Madrid next 9th June.

Lately Greek courts have favoured the idea that these kind of terms should be rendered totally void.” said Mr. Moshopoulos. So in the Cyprys Report can be read a new about the case won in the Athens Court of First Instance and applies also to a large number of Greek & Cypriot borrowers who contracted in foreign currency loans, so the lawyer Theodoros Makris.

Greek courts the last 2 years have recognized that the term of the mortgage contract which in fact burdens the customer to suffer any currency fluctuation from euro to Swiss franc is totally void. The reasoning behind that was based mainly on the 2251/1994 Greek Bill of Consumer law article 2 which deals with the rights of the consumer at the time of the dealing with the bank. In fact the specific law is part of the 93/13 European regulation issued on the 5.4.1993 and in particular article 3 which states that “A term of the contract which was not part of the negotiations among the parties is to be rendered void when it creates serious imbalance between the rights and obligations of the parties.

The 35/2015 decision of the Multi number court of Rhodes, the 373/2015 (force measure procedure), of the court of first instance of Rhodes as well as the 248/2015 of the same court put forward the view that the customer should keep repaying his mortgage with the exchange rate that it was originally taken and NOT with the rate that it changed afterwards against the customers’s rights.



  • Swiss Franc Loans in Practice and Banking Ethics – Evi Avlogiari (London – 9/9/2015 – PDF)

  • FX Loans – Evi Avlogiari with the contribution of Magda Glavina (PDF)



Landmark Case for Swiss Franc Borrowers