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The European Central Bank (ECB) has approved this Friday a measure that banks considered key to carry out the moratorium on mortgage payments decreed last Friday by the Government and help channel loans with public guarantees of up to 100,000 million of euros.

The European supervisor thus gives a new twist to its policies to combat the economic slowdown and the stock market turbulence derived from the pandemic.

In this case, the Governing Board has announced that the agency will be more "flexible" when considering a doubtful loan due to non-payment of installments or to the risk that a company may be affected by the crisis.

In this way, the ECB announces that those loans that are classified as "doubtful" due to the continued non-payment of their installments will have preferential regulatory treatment, so that the entities will not have to allocate the usual provisions to cover delinquencies and avoid an impact. stern on his balance.

Finally, the supervisor gives a truce to the entities in their toxic asset reduction programs -such as, for example, credits linked to real estate development-, understanding that in the current market conditions the sale would entail notable losses.

These measures are in addition to those announced by the monetary authority on March 12, when it allowed banks to use part of their capital and liquidity buffers. The ECB has quantified that the capital released reaches 120,000 million, which will allow banks to absorb losses without generating regulatory actions of up to 1.8 trillion euros in loans to households and companies.

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  • economy
  • Mortgages
  • Coronavirus
  • Covid 19

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