New arrangements for the payment of existing loans
The Central Bank of Cyprus announced that in order to assist those borrowers who are facing problems in servicing their debt, as a result of the adverse conditions created by the Eurogroup’s decision of 25th March 2013 on the Memorandum of Understanding, it has asked credit institutions in Cyprus to make arrangements in order to improve borrowers’ ability to repay their loans. The credit institutions will grant a grace period of 60 days, starting from 17th of April 2013, during which:
- these borrowers are not handled in the same way as the other borrowers with non-performing facilities. This implies that the accounts of these borrowers are not transferred to the Debt Recovery Departments and that no legal measures are initiated;
- extra charges, overdue interest and interest on arrears for these borrowers are suspended without impact on contractual interest, and
- banks immediately proceed with workout arrangements with these borrowers for a restructuring of their facilities in accordance with a new assessment of their repayment ability.