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September 23, 2020

One year loan payment suspension for SMEs is considered

Banks consider suspending for up to 12 months the payment of installments in case of loans for small and medium sized companies, following a pattern recently adopted in Italy, Mediafax informs. The initiative comes from PSD leader, Mircea Geoana. “We propose 12–month suspension of the payment of the principal in case of medium and long term loans, as well 6 to 12 month suspension of leasing related loans, so that only interest payment should be made through this time,” Geoana said yesterday after a meeting with the representatives of Romanian Association of Banks, National Bank of Romania and businessmen.

The PSD leader explained that, for the time being, this is not an initiative of the coalition since the measure adopted in Italy requires government and legislative power to a lesser extent and more it involves banks and businesses. The PSD head explained that the measure could apply to those companies which comply with the European definition, Romanian one included, for SMEs, namely companies with less than 250 employees, turnover less than EUR 50 M and assets less than EUR 25 M. He added that the suspension of payments would not apply for loans at which delays are already reported. Prime vice-governor of National Bank of Romania, Florin Georgescu, said that the experts of the central bank, together with those of the Romanian Association of Banks (ARB), would shortly proceed to analyzing the impact of such measures. ARB Chairman, Radu Ghetea, said that banks were interested in such a program since forced foreclosure was not a solution for this time.

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