Bulgarian National Bank extends moratorium for loan repayment applications

Bulgaria

On 9 July 2020, the Bulgarian National Bank (BNB) approved the moratorium extension for customer loan repayments and approvals from 30 June to 30 September 2020 and extended the final deadline for bank customer loan repayments from 31 December 2020 to 31 March 2021.

The decision came after the 25 June publication of the European Banking Authority's (EBA) updated Guidelines that amended legislative and non-legislative moratoria on loan repayments applied in response to the COVID-19 crisis. As previously reported, on 14 March the BNB announced a sector-wide moratorium on payments following the adoption by the EBA of the Guidelines in order to support individuals and businesses affected by payment difficulties and financial shortages.

As a result of recent developments, however, the EBA extended the application date in these Guidelines by three months from 30 June 2020 to 30 September 2020, emphasizing the importance of supporting banks and fostering the adequate treatment of borrowers across the EU during the current COVID-19 crisis.

After the Association of Banks in Bulgaria (ABB) proposed extending national deadlines in line with the EBA, the BNB approved the request, thus complying with the amended Guidelines and fulfilling its mandate as the competent national authority.

In addition, the BNB will publish monthly aggregated information in connection with received and approved moratorium requests. Information for the months of April, May and June 2020 will be released on 31 July 2020. After that, data will be issued at the end of every month.

CMS Bulgaria will keep you updated on the moratorium, but for more information on how the moratorium could affect your business, contact your usual CMS advisor or CMS experts Gentscho Pavlov and Ivan Gergov.