it is the story of banks having assets on their books worth x amount but in reality is worth much less but as far as bank is concern is worth x and that shows they have more assets then liabilities so the bank is solvent and the executives can get bigger compensation but the reality is that the financial system is on verge of collapse and yes bank can dictate the amount of money you can list the apartment for, special if you do a short sale.
Assuming the bank/mortgagee holds a lien on the property (almost universal unless you purchased the property on a purely personal guarantee), they probably can't stop you from trying to sell your property for a price. They CAN stop the sale from being completed until and unless you re-negotiate the terms or are prepared to pay off the mortgage per your contract on completion of the sale.
Before you giggle too much at how stupid that is, you need to back up a step or two.
There are alternatives here for both the bank and the man.
1. The man can sell his apartment simply by going to the bank and declaring his intention to sell it at market price and pay the difference which will pay off the mortgage as originally allowed for as an early payoff in the mortgage agreement/contract. If I was the banker, I would require him to put the expected difference in an escrow account pending the sale. Any offers he gets would require either depositing more money into the forfeiture account or getting the banks agreement to accept a loss. The bank will make the sale conditional on being the recipient of the proceeds then close the escrow account by withdrawing the balance to pay off the loan, refunding any credit for additional payments during the sale process.
2. The man and the bank can attempt to re-negotiate the loan for lower value or (bank's second choice) give the bank all of the proceeds from the sale and then carry the balance as a personal loan, possibly providing other forms of security or payment(s) in kind.
3. If the bank was silly enough to NOT have the man personally liable for the loan but only has security through a lien or chattel arrangement, then the man can say okay and give them the property. Then walk away and never look back.
People do this sort of thing every day. Sometimes both parties agree to it, sometimes one party is forced by the other and sometimes both parties are forced by contract conditions, or triggers, to do so.