foreign banks

UniCredit sets out $8-billion aid package for Italy clients hit by surging prices

Reuters
UniCredit sets out $8-billion aid package for Italy clients hit by surging prices

UNICREDIT. The headquarters of UniCredit in downtown Milan, Italy, February 4, 2016.

Stefano Rellandini/Reuters

UniCredit will offer companies 5 billion euros in new loans to help them pay their energy bills. Another 3 billion euros will be made available through payment suspensions and other measures for holders of credit cards and mortgage loans.

MILAN, Italy – Italy’s second biggest bank, UniCredit, on Monday, September 5, unveiled a set of measures worth up to 8 billion euros ($8 billion) to ease the pain of firms and households hit by record energy costs and a wider price surge.

Chief executive Andrea Orcel told a press call that UniCredit, which operates also in Germany, Austria, and Eastern Europe, was working on similar measures for its other markets, and reassured them of the quality of the bank’s loan book.

Though UniCredit is aware that many of its customers, especially in energy-hungry sectors such as steel or ceramics, are struggling, Orcel said loan repayments had kept up the benign trends seen in the second quarter.

“Ours is a preemptive move,” Remo Taricani, the bank’s deputy head of Italy, said. “We asked ourselves: What can a bank do to help with the structural reduction in households’ disposable income and companies’ cash flows we’ll observe in the next two to three months?”

Separately on Monday, Italy’s biggest bank, Intesa Sanpaolo, said it would provide an additional 2 billion euros in financing to small businesses to cover energy costs and offer a payment suspension of up to 24 months on existing loans.

UniCredit will offer companies 5 billion euros in new loans with a maturity of up to three years to help them pay their energy bills.

Another 3 billion euros will be made available through payment suspensions and other measures for holders of credit cards and mortgage loans.

Companies that have not tapped guarantees on bank debt made available by the government can request until December 31 a 12-month moratorium on their mortgages, UniCredit said.

An up to 12-month suspension for capital reimbursement and the possibility to tweak the repayment plan will be given on 400,000 house mortgages.

Some 1.4 million credit card holders will have the chance to postpone by up to six months with zero rates and fees their payments from October 1 to the end of the year. – Rappler.com

$1 = 1.0075 euros

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