After overcoming a crisis that shook the foundations of the Spanish banking system, financial institutions face an even greater challenge in the years to come. They are starting off with an advantage over the crisis of 2009, which is that no one will be able to attribute to them the economic problems that our country will face, after a standstill in activity that is unprecedented in the last 50 years. Moreover, they have the experience of a not too distant past to adapt to the difficult future facing the Spanish business fabric.
However, we must be aware that their intervention in the market will be decisive for the success of our country’s economy. For this reason, they now have the opportunity to totally change their image and apply what they have learned in the past, being in practice true regulators (i) in the granting of ICO financing, within the requirements established by the state, and granting these loans to the maximum number of entities possible; (ii) in the granting of moratoriums, ensuring that they are granted to those affected, and in general; (iii) in the financial restructuring processes of the thousands of companies that are being affected by the inactivity of these months and those that still lie ahead, where their role can be vital for these companies.
Today, 7 July 2020, Royal Decree Law 25/20 of 3 July comes into force, approving the second line of guarantees (ICO) for the coverage, on behalf of the State, of financing granted by supervised financial institutions to companies and self-employed workers with the main purpose of financing investments amounting to 40,000 million Euros and thus promoting the country’s economic recovery. For all these reasons, it is increasingly necessary for the government and financial institutions to seek bridges of understanding and collaboration in order to support the challenges ahead. We must not forget that the guarantor of these loans is the State and will take the place of the financial institutions in the event of non-payment and, surprisingly, the new wording of the current Article 87.6 of the Bankruptcy Law – Article 263 of the Revised Text of the Bankruptcy Law – which will come into force on 1 September, jeopardises the possibility of recovering these ICO credits in the event of the debtor being declared bankrupt.
In short, it is important that financial institutions exercise exhaustive control in the granting of these State-guaranteed loans, since the objective of all must be aimed at the recovery of productivity of Spanish companies with viability, and financial institutions have highly qualified tools and departments that, without undermining their business, can demonstrate to society and public authorities that they are the first to be interested in such recovery as quickly as possible.
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