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EBA’s statement on payment delays linked to COVID-19


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The spread of the coronavirus has introduced considerable challenges for society as a whole, and even the financial system. We find ourselves in an exceptional situation, and uncertainty is widespread. These extraordinary circumstances demand appropriate application of existing regulations, including rules for forbearance and assessment of a significant increase in credit risk.

“It is important to apply the regulatory framework appropriately in uncertain times. Payment delays must not be viewed automatically as increased credit risk,” says Director General Erik Thedéen.

The European Banking Authority (EBA) has issued a statement today on, among other things, the definition of default, forbearance measures and IFRS 9 given the spread of COVID-19. The EBA has stated that general payment delays must not be viewed automatically as forbearance measures or an indication of a significant increase of credit risk in accordance with current regulations. This refers to loans to both households and corporates.

The EBA also clarifies that banks facing a substantial increase in individual assessments shall prioritise them by applying a risk-based approach. The banks should focus on assessing the exposures most likely to have the greatest impact.

The EBA’s statement also discusses some matters from a consumer protection perspective, as well as extended deadlines for some remittance dates and consultations.

FI stands behind the EBA’s statement.

Regulator Information

Abbreviation: FI
Jurisdiction: Sweden

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