Rescheduling of Loans in the Conditions of Difficult Agricultural Production

Bearing in mind the current economic situation in which some farmers found themselves, as well as the strategic importance of agricultural production for the citizens and economy, the National Bank of Serbia brought a Decision on Temporary Measures for Banks for the Purpose of Adequate Management of the Credit Risk in the Portfolio of Agricultural Loans in the Conditions of Difficult Agricultural Production ("Official Gazette of RS" No. 111/2022 as of 7 October 2022) (hereinafter referred to as: the Decision), in order to enable rescheduling of loans granted for the purpose of performing agricultural activities.

In accordance with the above mentioned Decision, Postal Savings Bank, joint-stock company, Belgrade, enabled to its clients – the farmers entered into the Register of Agricultural Holdings in terms of the law governing agricultural and rural development such as:

• 1. a natural person who is the holder of a commercial family agricultural holding in terms of the law governing agricultural and rural development;
• 2. an entrepreneur;
• 3. a legal entity, such as:
  - a farming cooperative with at least five (5) members who are entered into the Register as holders or members of five (5) different agricultural holdings entered into the Register,
  - other legal entity classified into micro or small enterpises in accordance with the law governing accounting,

who have liabilities towards the Bank based on the loans at their request, to use rescheduling in accordance with the said Decision.

The Bank may grant rescheduling of the repayment of liabilities based on the loans granted under a guarantee scheme of the Republic of Serbia or with a guarantee of international financial institutions, as well as based on subsidized loans, only with prior consent of the giver of a guarantee or subsidy.

The Bank will grant its clients to reschedule the repayment of loans after they submit an application if all of the following three conditions were met on 31 May 2022:

• Client is not in default longer than 90 days on any liability to which rescheduling applies;
• Client is not in the status of outstanding liabilities towards the Bank in terms of regulations of the National Bank of Serbia;
• Claims of the Bank towards the client are not considered as NPL, i.e. bad debt in terms of regulations of the National Bank of Serbia.

Facilities in the repayment of liabilities may be used for one or more loans in the Bank, but the application for granting rescheduling may be submitted for the loans granted until 8 October 2022.

Rescheduling is a change of conditions of a specific loan in such a way to enable the Client a grace period in the repayment of all of his/her/its liabilities towards the Bank on that loan for the period from 6 to 12 months (depending on the period for which the borrower opts for in his/her/its application), during which the Bank shall not charge its claims based on principal, whereby the Bank charges the agreed interest in that period, and the repayment period of such loan will be extended in such a way that the amount of annuity after the expiry of the grace period, and until the end of the new repayment period of the loan, is not higher compared to that amount in the period prior to the application for rescheduling.

Rescheduling of the Client’s liabilities based on the interest calculated during the delay in the repayment of liabilities (moratorium) in terms of regulations on temporary measures for banks in order to maintain the stability of the financial system will be applied in such a way that the interest is charged after the expiry of the grace period. The interest continues to be evenly distributed over the loan repayment period and it will not be accrued to the rest of the debt which will be regulated by an annex to the loan agreement.

If rescheduling has been granted to the Client, a delay in the settlement of the Client’s liabilities based on the loan that is to be rescheduled shall cease to run on the day when the application for granting rescheduling has been submitted. The Client’s delay in repayment towards the Bank is determined according to the newly agreed repayment plan.

In the process of granting rescheduling, the collaterals for the collection of claims will remain unchanged.

Partial repayment of a loan can be made after the expiry of the grace period, whereas during the grace period only the repayment of the whole loan can be made.

For loans with a variable interest rate, interest rates will be adjusted after the expiry of the grace period, in accordance with the Contract.

The Bank shall not charge the Client a fee for processing, i.e. execution of the application for rescheduling, nor any other costs in relation to taking measures and activities in accordance with this Decision, except for the costs required for approving rescheduling that are not determined by the Bank (Credit Bureau costs, real estate cadastre, tax administration and other costs).

Other conditions remain unchanged in relation to the conditions regulated by the basic contract.

The Bank will decide on your application and inform you about its decision within 30 days following the day of receipt of the application.

In case you fulfill the above mentioned conditions, you can submit an application for granting rescheduling, no later than 30 April 2023, in one of the following ways:

• 1. at the business premisses of the Bank;
• 2. electronically, by submitting a scanned and completed request for approving the rescheduling with the required documentation to the following email adress: plasmani@posted.co.rs and agroposlovi@posted.co.rs;
• 3. by mail to the address of the Bank: Banka Poštanska štedionica, a.d., Beograd, Kraljice Marije, br. 3, 11120 Beograd (with an indication „for Corporate Operations Department – Agricultural Operations Service).

You can download the Application for Facilities form here.