ABN AMRO extends support measures for businesses affected by coronavirus

  • Banking
  • 27.03.2020 10:09 am

Last week ABN AMRO announced that, for Commercial Banking clients with a credit facility of up to 2.5 million euros, payment of principal and interest will be deferred for six months.

Today ABN AMRO is extending this measure to Commercial Banking clients with a credit facility with a principal and/or a limit of up to 50 million euros.

Principal and interest payments will not be collected from these clients from April through September. They will be allowed to make these payments at a later date. Any client that does not need to defer payment is required to inform the bank by 31 March 2020 at the latest. Payment will not be deferred for these clients.

Breathing space

Daphne de Kluis, CEO of Commercial Banking: “The deferral measure gives clients more scope in their liquidity position. And by automatically implementing it, we can make these arrangements quickly for a large group of businesses. We saw last week that this works well and gives clients peace of mind. We have therefore decided to raise the limit to 50 million euros. This will give larger Commercial Banking clients breathing space too.”

Large government support package

ABN AMRO’s measures are in addition to a large package of measures offered by the Dutch government. Businesses can apply for additional government-guaranteed loans from their banks, including under the SME credit guarantee scheme. Other parts of the government support package also offer businesses extra liquidity.

Many questions

Many businesses are eager to make use of support and deferral measures, and many have questions or are applying for a loan under the SME credit guarantee scheme. As a result, they may have to wait. Priority will be given to clients who are being immediately affected and/or hit hard financially.

No impact? Inform the bank

Deferral of interest and principal payments is explicitly intended for businesses that need support due to the impact of coronavirus. Deferral of payment will be implemented automatically for Commercial Banking clients with a credit facility with a principal and/or limit of up to 50 million euros. ABN AMRO is doing this to offer fast support to a large group of businesses. Clients in this category who do not need this support are required to inform the bank of this by 31 March 2020 at the latest. If they do not do so, payment will be automatically deferred. Details of the measure for credit facilities of up to 2.5 million euros are available on our website; this measure will now also apply to Commercial Banking clients with a credit facility with a principal and/or limit of up to 50 million euros. The website also describes the scope of the measure, and how and when payment must be made at a later date. Businesses that do not need support can inform the bank of this on our website.

Commercial Banking clients

Commercial Banking clients are companies with annual turnover of up to 250 million euros. From today, the deferral measure will apply to all Commercial Banking clients with a credit facility with a principal and/or limit of up to 50 million euros, with the exception of a number of specific types of financing, such as commercial finance, leveraged finance for professional investors, club deals and syndicated loans with several financers, and financing for commercial real estate in excess of 2.5 million euros. However, real estate clients with a credit facility of between 2.5 million euros and 50 million euros that lease property to hard-hit sectors are eligible for deferral.

Loans managed by the Recovery team of the Financial Restructuring & Recovery department are not in scope. This also applies to loans linked to interest rate derivatives. Clients with interest rate derivatives can contact the bank to discuss their options.

Above 50 million euros

Where possible customised arrangements will be offered to Commercial Banking clients with a credit facility in excess of 50 million euros. This is also the case for large corporate clients served by Corporate & Institutional Banking (annual turnover in excess of 250 million euros).

Commercial Banking’s total loan portfolio was 42.6 billion euros at year-end 2019. Around 40% of this loan volume concerns clients in scope of the new measure. The impact of the coronavirus on the economy, on our clients and on the quality of our loan portfolio is currently uncertain.

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