The Banking and Payments Federation Ireland (BPFI) confirmed on 30 April 2020 that BPFI members including the five retail banks, non-bank lenders and specialist lenders have agreed that the previously offered three month moratoriums for personal borrowers and SME business customers may be extended by a further three months to a total of six months in total.
This follows on from the agreement details of which were announced on 19 March that banks would offer three month payment moratoriums to assist borrowers in managing their expenses during the COVID-19 pandemic. Click here to read our earlier article.
Although not expressly stated by the BPFI and, at time of writing not yet confirmed by the Central Bank of Ireland, it is also expected that on the basis that this is an extension of the previously agreed programme, the same treatment will apply in terms of this not adversely affecting the record of individuals applying for such an extension on the Central Credit Register.
Each lender will have its own procedure for implementing any extension. Given that during the payment moratorium interest will still accrue on the borrowing in question, we would expect that borrowers will need to re-engage with their lenders to request this further extension rather than it being automatic.
Lenders have previously highlighted the importance of borrowers engaging with them promptly and proactively on matters relating to these moratoriums. Borrowers will need to bear in mind that having only recently processed applications for the initial three month moratorium programme, their lender may now have to undertake a similar process with borrowers requesting further extensions and so any application may take time to progress.
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About the Authors
Michael is Head of the Banking and Financial Services team at Hayes solicitors. He advises on a broad range of domestic and cross border finance transactions. His primary focus is acting for lending institutions and borrowers on leveraged/acquisition, commercial property, construction/development and SME finance transactions.
Tim is an Associate in the Banking and Financial Services team at Hayes solicitors. Tim has extensive experience advising both borrowers and lenders across a wide range of financing transactions including corporate debt facilities, complex cross-border financings, export-credit backed lending and leveraged/acquisition finance.