EnglishThe Croatian government is preparing a law concerning the conversion in Euros of the Swiss Franc loans, a measure which will benefit several thousands of debtors, a government source told Reuters yesterday.
The law, which would be presented by the minister of Finance, Boris Lalovac, on the next government meeting, is meant to replace the current temporary solution, which sets the exchange rate at 6.39 kuna for one franc. This solution expires at the end of January 2016.
The loans in question would be converted to Euros at the exchange rate in effect on the day the loan agreement was concluded. The cost of the conversion would be borne by the commercial banks, whose losses could be recognized at tax breaks.
"The government may pass this decision shortly", the source said.
Approximately 60,000 Croatians have loans denominated in Swiss Francs, taken out in the 2000s, when many people in Central and Eastern Europe were lured by the low interest rates on loans denominated in Swiss Francs. Since then however, the significant strengthening of the Franc has led to the increase of the costs with the repayment of loans denominated in francs, and the governments in the region have begun looking for solutions to this problem, according to Agerpres.
In Hungary, at the end of last year, the government led by Viktor Orban has ordered the conversion to Forints of loans denominated in foreign currencies, a decision which helped the debtors, but which affected the banks.
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