Negotiations breakthrough to prevent COVID crisis turning into banking crisis

“It is a big relief that we can finally get on with the work of solving the challenge of problematic loans held by banks. With this deal this evening, we have added a new tool which can help us prevent the economic downturn during the Corona crisis from turning into a new banking crisis”, said Esther de Lange MEP, Vice-Chairwoman of the EPP Group and co-Rapporteur of the non-performing loans file on which a deal was reached with the EU Member States.

She is satisfied that the negotiating team from the European Parliament managed to include sufficient consumer protection in these sensitive files and there is now clear improvement in transparency and standardisation to make comparisons easier for buyers and sellers of non-performing loans in secondary markets.

“We, as co-legislators, now need to work on an agreement on the remaining part of non-performing loans, which is the proposal from the Commission of out-of-court collateral enforcement (accelerated extrajudicial collateral enforcement, AECE) for loans granted to corporates”, de Lange concluded.