March 15 (SeeNews) - Slovenia's top court has suspended the implementation of a law splitting between creditors and borrowers the currency risk on loans extended in Swiss francs between 2004 and 2010, Nova Ljubljanska Banka (NLB) [LSE:NLBR] said.
The implementation of the law has been suspended on March 10 until the final decision of the Constitutional Court on the conformity of the law with the constitution, NLB said in a filing with the Ljubljana Stock Exchange on Monday.
An application for the review of the conformity of the law with the constitution was submitted in February by nine banks, including NLB, which claim that its implementation could have negative consequences for the customers, the economy and the state. A separate request for the review of the constitutionality of the law was also submitted by Slovenia's central bank.
'We have repeatedly emphasized that the law is unconstitutional in several respects, as it retroactively interferes with valid contractual relations, as well as violates the principles of legal security, equality, the right to private property and to free economic initiative. In addition, the Law is contrary to the EU's acquis,” NLB CEO Blaz Brodnjak said.
The law obliges lenders to retroactively introduce an exchange rate cap for all Swiss franc loans extended in 2004-2010 and also refers to loans that have since been repaid or converted to euro.
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