The Finance Latvia Association (the Association), in collaboration with its members, has continued its work on developing support tools for bank clients suffering from short-term financial difficulties due to COVID-19. In addition to the moratorium for private individuals, a moratorium for businesses has been developed which will allow businesses to defer payment of their loan principal for the term of up to six months. The moratorium has been agreed with the Financial and Capital Market Commission, and has also been reviewed by the Competition Council of Latvia after consultations with the European Commission.

“The development of this moratorium is a continuation of the moratorium for private individuals on the deferral of loan principal repayment for a set period of time, which was confirmed last week. As of now, the banks have reviewed loan agreements and the repayment of remaining payments for more than 2,450 transactions in the business segment. We recognise that the consequences of the state of emergency in the business segment will continue to develop gradually, which is why the Association and its members have developed a moratorium in accordance with best practices and using guidelines from  the European Banking Authority. This document will allow changes to loan agreements to be made as effectively and uniformly as possible. Any credit institution, its subsidiaries and branches can join the moratorium, and it can be observed individually by any Latvian crediting market participant which issues loans to businesses,”

 – emphasises Sanita Bajāre, Head of the Finance Latvia Association.

Financial institutions will publish news of joining the moratorium on their websites, and will also inform the Financial and Capital Market Commission, the Competition Council of Latvia and the Association. The Association will receive up-to-date information from the financial institutions on the total number of clients and loans for whom principal repayments have been deferred. The financial institution may apply the moratorium to one or both service types: loans and/or leasing. It should be said that the moratorium applies to loan agreements with a fixed repayment schedule. The total sum of a client’s obligations in accordance with all loan agreements within one financial institution must not exceed five million Euro. Clients whose obligations exceed this sum will be assessed individually.

The moratorium applies to legal persons and other entities involved in economic activity, except self- employed individuals. The moratorium will change the repayment schedule of the principal if the loan agreement stipulates the repayment of the principal in installments. According to the client’s request, the repayment of the principal is partially or fully deferred for the term of up to six months as it is stipulated in the moratorium. During this deferral term, the client must continue to pay interest, insurance premiums and other payments stated in the loan agreement which are not the principal. Financial institutions may not ask for additional collateral or increase the interest rate.

Clients can defer their principal repayments in accordance with the terms of the moratorium once. If the client got loan repayment relief between March 12th, 2020 and the day the moratorium comes into force, the financial institution has the right to change this in accordance with the moratorium per the client’s request. Commission fees for processing the moratorium only apply for the amount needed to prepare documentation for the agreement amendment.

The moratorium stipulates that businesses may defer the repayment of principal if they were not in financial difficulties before March 12th, 2020, or if there are no insurmountable obstacles in repaying the loan.

A business can apply for the use of the moratorium if the company’s own capital was positive at the end of the previous financial year, and if loan repayments were not overdue for more than 30 days within the past year from March 12th, 2019. The client must state the reason, linked with COVID-19, for its worsened financial circumstances to its servicing financial institution.

The moratorium does not apply to businesses whose main business is gambling. The moratorium will also not be applied to businesses which are insolvent, bankrupt or who have gone into administration. It will also not be applied to businesses with whom relations have been terminated in accordance with  prevention of money laundering and terrorism and proliferation financing laws or international targeted financial sanctions.

The moratorium comes into force on May 5th, 2020, and remains in force until the Association issues notification of its ending. Clients must apply for deferral of principal repayment by June 12th, 2020, and the financial institution must make a decision by June 30th, 2020.

As of now, the following institutions have announced their willingness to join the moratorium: Swedbank, SEB banka, Luminor, Citadele, ALTUM, BlueOrange Bank, OP Corporate Bank, Industra Bank, Expobank, Signet Bank.



For more information:

Sabīne Spurķe


+371 20604166

Head of Communications

Finance Latvia Association

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