March 23 (SeeNews) - The non-performing loan (NPL) ratio of Montenegro's banking system will remain unaffected by the three-month moratorium on loan repayment imposed by the government due to the coronavirus crisis, local media reported.
The NPL ratio will not increase in the next three months since the delay in the repayment of loans throughout the period will not be taken into account when calculating the ratio, news portal Bankar.me quoted the president of the local banking association, Mladen Rabrenovic, as saying on Sunday.
"For the duration of the moratorium, interest will be calculated but will not be charged and will be allocated through a new annuity plan for a period that is three months longer than the original repayment period," Rabrenovic said.
The ratio of NPLs to total loans in Montenegro's banking system was 4.67% at the end of September, according to the latest data available from the country's central bank.
Last week, Montenegro's government imposed a three-month moratorium on the repayment of bank loans in an effort to limit the economic impact of the coronavirus crisis. The repayment of loans to banks, financial leasing companies and the Investment-Development Fund of Montenegro (IRF) will be postponed at the request of citizens and businesses.
Montenegro has so far confirmed 22 cases and one death of the novel coronavirus disease (COVID-19). The country has closed its borders for foreign nationals to prevent the spread of the disease on its territory.