Bankers reject conversion of Swiss franc credits by law

Imposing solutions for Swiss franc debtors by law, against the market principles, could result in a lack of predictability in economy and investments and in unfair discrimination among banks' customers, the Council of Bank Owners of Romania (CPBR) stated in a release to AGERPRES on Thursday.

Photo credit: (c) SILVIU MATEI / AGERPRES FLOW

On the other hand, a law of individual insolvency might be useful if it would not encourage indiscipline in reimbursing credits, bankers say.

'CPBR considers that any initiative of converting foreign currency credits should take into account the principles of the European Directive No. 17 of 2014, which stipulates the conversion operations should use the exchange rate of their effective dates. (...) Although the Directive is applicable from March 2016, CPBR considers that drafting national legislations in accordance with the Directive is possible as early as this year,' the release reads.

Using a different exchange rate than the current one cannot be addressed by legislation, CPBR asserts; it should be treated case by case between the banks and their customers; an exchange rate imposed by law could result in inequities among clients.

For instance, debtors who borrowed hundreds of thousands or millions of Swiss francs for real estate investments would have the same treatment as those who are objectively unable to reimburse monthly instalments, CPBR's experts pointed out.

CPBR warns that a private insolvency law might encourage abuses and indiscipline in credit reimbursements. The concept of individual insolvency was not promoted and publicized correctly so far; it was perceived as a lifebuoy for consumers facing financial trouble, but wanting to maintain their living standards although...