THE CENTRAL Bank of Cyprus announced on Monday that credit institutions are obliged to inform and explain adequately to borrowers experiencing financial difficulties, their rights and obligations during the procedure of management of delays and loan restructuring.
According to the Code of Conduct on the Handling of Borrowers facing financial difficulties, the Central Bank expects and demands all credit institutions to take into account the financial realities of their customers, acknowledging that customers who are experiencing financial difficulties are in a particularly difficult position and that they depend on the credit institution to assist them during this difficult time.
The Central Bank also notes that it is very important, for the borrower, once approached by a credit institution, to provide all necessary information requested.
It also stresses that all credit institutions should communicate in time with borrowers who are experiencing financial difficulties and consult in a positive spirit and a constructive way and to make continuous dialogue with borrowers in order to reach a mutually acceptable restructuring solution.
In late March Cyprus averted a collapse of its banking sector after agreeing on a €10 billion bailout with the Troika (EC, ECB and IMF), that featured a haircut of banking deposits over €100,000 in its two larger lenders and an array of public spending cuts and salary reductions.
Source: Cyprus News Agency
Dear Mr Developer,
Our meticulous book keeping shows that you have not made any repayments on your 1 million Euro loan during the last 8 years. This loan was provided to you (not your future buyers)at an annual compound rate of 13% and YOUR balance now stands at €2,658,444.
We the Bank have a duty to “communicate with borrowers in time if they are facing difficulties”.
After 8 years and much pressure from the Troika we now consider the “time” is right for you to think about making some repayments.
Failure to do this will result in us having to Repossess the homes of any buyers who may have bought from you in good faith and without knowledge of YOUR loan.
Yours sincerely ,
Cousin Costas @ Anybank Of Cyprus.
First Things First Gavin. When Borrowers supply all the Information to the Banks, Then when some Time passes, SAY, ABOUT 100 YEARS or maybe a bit more, The Central Bank WILL instruct those self same ‘credit institutions’ to divulge “all the necessary information†to prospective real estate purchasers that the houses and apartments they’re buying are already encumbered by developer mortgages. That’s how it works here in Cyprus. Doesn’t it ??
Regards
Talk about shutting the stable door!
Well isn’t this just dandy. The Central Bank has instructed borrowers “to provide all necessary information requested” by a credit institution.
What about the Central Bank instructing those selfsame ‘credit institutions’ to divulge “all necessary information” to prospective real estate purchasers that the houses and apartments they’re buying are already encumbered by developer mortgages? I suppose that doesn’t count.