Church of Greece scrambling to avoid bankruptcy

first_imgThe Church of Greece is struggling financially as revenues dry up and taxes keep rising, with emblematic monasteries such as those of Petraki and Penteli in the capital putting a freeze on payments in order to make ends meet.Churches and monasteries across the country are already facing problems paying salaries, seeking to settle their bills and property taxes in instalments and selling off real estate to raise the cash to cover operating costs. The result is that their social programs are now at risk, such as soup kitchens for the poor, something that is expected to set off a domino effect of social implications, as the church is one of the driving forces in the effort to help the worst affected by the economic crisis in Greece.As the church scrambles to raise funds, the state keeps raising obstacles to investments, while a solution has yet to be found as regards its prime real estate assets. A total of 123 church properties in Athens, Vouliagmeni, Piraeus and Thessaloniki have been sold to the state but not paid for, while the church can no longer make use of them.The Church of Greece has two main sources of income – real estate and National Bank of Greece shares – and both are drying up: rents are declining and buyers are increasingly hard to come by, while NBG shares were at €0.23 at the time of going to print.Speaking to Kathimerini, the general director of the Central Ecclesiastical Financial Service (EKYO), Father Salonon Antonios, explained that the church participated in NBG’s share capital increases in 1996 and in 2005 doubling its stakes’ value. To participate in the process, the church was granted a loan of €27 million from Hellenic Postbank and used another amount equal to that from its savings.However, says Antonios, “the church does not gamble”, suggesting that the shares should have been better managed and sold at peak price. This didn’t happen and then the crisis hit the church as it did the country, with NBG stopping dividend payments in 2008 and the price of shares plummeting to levels at which they are not worth selling.At the same time, the slump in the real estate market caused another major source of revenue to dry up for the church, which has 19,000 hectares of arable land, 700 plots of land, 400 office spaces and 260 residences in its portfolio. Rents have dropped at rates of between 30 and 70 per cent depending on location since 2008, many properties are untenanted and utilising them is a headache because of the cost of maintenance – for which there is no cash.“The church’s revenues have declined by about 75 per cent today compared with 2008. Then, the annual budget was around €23 million and today it is around €6 million,” stresses Antonios.“Meanwhile, EKYO is responsible for funding to all metropolitan churches, most of which run programs to help the poor and the homeless, showing that these program will be at risk unless solutions are found.”EKYO has called on the state to take action to attract investors and to solve a number of problems that are preventing it from utilising properties. Every metropolitan church, monastery and even parish church has assets that they themselves manage and each of these entities pays property and income tax – in contrast to popular belief. Petraki Monastery, struggling with salary payments, recently applied to enter a scheme that allows indebted taxpayers to pay their contributions in 100 instalments. As further evidence to dispel the myth of the church’s enormous wealth, according to sources, Petraki Monastery’s real estate assets are limited to one building near Evangelismos Hospital in Kolonaki and another on Koumoundourou Square, both in central Athens though widely disparate in terms of property values. Penteli Monastery is not faring much better, as it recently sold its single real estate asset in order to meet operating costs. Facebook Twitter: @NeosKosmos Instagramlast_img

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