Application of Legislative and Non-legislative Moratories in the Matter of Suspension of Bank Loans

Abstract

In order to avoid blocking the capacity of the banking system to finance the domestic economy, a legislative package was issued in order to protect the interests of bank debtors, at the suggestion of EBA and against the background of the crisis caused by COVID-19. In addition, the legislative moratorium was supplemented by a non-legislative moratorium, and as a result of their application, the payment obligations of the debtors who requested the postponement were suspended. The analysis of the effects produced on the banking market leads to the conclusion that the government's measures caused both positive and some negative effects - the risk of default for banks and public exposure being the sensitive factors. As a result, the state and the B.N.R. intervened with specific means.