More specifically, the loan to value ratio has been lifted and retail banks can assess independently the risk factors in regards to the loans they give as well as other necessary collateral.
Overall the new directive by the CBC aims to decrease the requirements in terms of collateral and guarantees mainly from individuals and small to medium-size businesses as the strict rules imposed after the 2013 banking crisis have made it extremely difficult for them to take out loans.
As far as loans in foreign currencies are concerned the CBC stated that retail banks should inform more thoroughly their clients about the risks involved. Furthermore, loan-holders of loans in foreign currency now have the rightto exchange the currency with another one, either the currency in which they receive their income in or that of another European member state country.
Finally, retail banks are liable for informing a loan-holder when the unpaid instalments exceed 20% of the loan’s nominal value due to fluctuations of the exchange rate.