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Press Release by The Banks Association of Turkey (“Association”) regarding Financial Restructuring Framework Agreement (“Agreement”)
With a new Press Release by the Association, it is stated that Financial Restructuring Framework Agreement has been signed and put into force by the credit-finance organisations that loans more than %90 of total credits, on September 19, 2018. The purpose of the agreement is to support businesses with discharge difficulty in consequence of temporary imbalance of income and expenses. The debtors who owes more than 100 million Turkish Liras will be eligible to benefit from this Agreement.
According to the Press Release, the Association will separately and carefully assess the financial situation, the ability to pay and the long-term debtor-creditor relationship, and financial organisations will provide flexibility to their clients for the credit opportunities and due date, payment and indemnity conditions.
A debtor company who wishes to restructure its debt must apply to a creditor financial organisation who is a party to the Agreement. The financial organisation who has received the application will relay this request to the Creditor Institutions Consortium (“Consortium”). After the feasibility assessment, the request will be voted by the Consortium, and if the two thirds majority will accept the restructuring request, the debtors’ application will be approved. If more than 90% of the Consortium approves, the debtor company may also take additional credits.