Banks in Serbia support the initiative to tackle the issue of loans indexed in Swiss francs and are ready to engage in finding solutions with the relevant state institutions – the Governing Board of the Association of Serbian Banks (ASB) has announced.
Following the Serbian state authorities also expressing their readiness to get involved in solving the problem of repayment of loans, particularly mortgages, indexed in Swiss francs, the ASB underlines that the loan contracts have a currency clause that is in accordance with the Law on Obligations, the Law on Foreign Exchange Operations and relevant by-laws.
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As they explain, banks loaned the money to their clients, the value of which was determined by the exchange rate, and the client has a contractual obligation to repay. Thus, the ASB states, it is its job to guarantee that that value remained, whereby the position of each contractual party (bank or client) is not affected by inflation or deflation.
“The Contracts that banks have concluded with their clients, repayment plans, and all other essential elements of the contract, as well as reports on the repayment status of the loan, always accurately and transparently state the amount of the client’s obligation in foreign currency”, the ASB explains.
Accordingly, the principles of equality of mutual benefits, conscientiousness and fairness are respected, which is required by the Law on Obligations.
As the ASB Secretary-General, Vladimir Vasic noted in this statement, the fluctuations in the Swiss franc/Serbian dinar exchange rate also hit the banks which had to borrow in this currency so that they could continue to approve such loans to their clients.
Taking into account the financial position of clients, the ASB reminds that in 2009, 2011, 2013, as well as in 2015, they offered to bank clients to convert these loans into loans indexed in euro, and that, in accordance with the National Bank of Serbia’s decision from 2015, a total of four conversion models were offered as a resolution to this problem.
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