The Bank Suspended Loans Of 54.11 Million Euros

2021-02-08   |   by CusiGO

From the beginning of the coronavirus epidemic to January 31, Spanish banks have suspended payments of 54.114 billion euros in loans. According to the Bank of Spain, this amount accounts for 4.15% of the total loans of various institutions, including mortgage loans and non mortgage loans. During this period, the bank received 1.49 million extension applications and approved 1.378 billion, accounting for 92.5% of the applications.

Since the outbreak of the crisis in March, the financial sector and the public sector have taken action to avoid a series of bad customers who have been victimized by the closure of many enterprises. In order to provide liquidity and new credit, up to 80% of ICO guaranteed loans have been set up, but in order to avoid repaying debts already incurred, mortgage and consumer loans have been suspended.

The Act provides rules for accepting these suspensions, but financial institutions offer additional suspensions to their customers, who are the most successful because they have received 820000 applications, more than half of them. The rest are requests for suspension of legislation, that is, requests made in accordance with the rules of law.

As of the end of January, there were more than 260000 applications for suspension of legislation with mortgage guarantee, of which nearly 222000 have been processed. “The outstanding balance of suspended loans was $19.955 billion. 72% of the respondents are working class, and the rest are self-employed.

In addition, after receiving more than 410000 applications, the outstanding balance of non mortgage loans suspended was close to 2.7 billion euros. As at 31 January, action had been taken against more than 362000 of them. Here, 73% of petitions are filed by employees.

With regard to departmental suspension applications, more than 820000 applications were submitted by entities to their customers, with an approval rate of 97%. In many cases, it is the banks themselves that call on customers to lift the suspension order to prevent them from defaulting. The outstanding balance of suspended loans was $31.48 billion. In this case, 80% of those affected are employees.

With regard to the self-employed, according to official data, the main beneficiaries of the suspension order are trade, hotels and other services, followed by professional, scientific and technological, transport and construction activities. In general, these branches account for nearly 80% of the total number of suspensions approved for the self-employed.

In contrast, the number of requests for suspension and concessions is much smaller in the two sectors seriously affected by the epidemic, namely, tourism and transport. “In particular, there are 1582 applications for suspension of legislation on real estate mortgage loans affecting the tourism industry, of which 1372 have been processed”, and the outstanding balance exceeds US $2 billion. On the other hand, there are 1851 legislative requests for suspension of transportation, 1665 of which have been approved, with an outstanding balance of US $125 million.

In early February this year, the application period and the statutory suspension period were extended, so that these two characteristics of all suspensions are generally in line with the guidelines issued by the European Banking authority. These measures cover vulnerable workers, families and collectives, providing the latter with legal advantages.