MINSK, 24 May (BelTA) – New instruments are being introduced on the Belarusian financial market to help restructure debts. Belarus President Alexander Lukashenko signed the relevant decree on 24 May, BelTA has learned.
In particular, state-run and private banks will be able to help steer the operation of companies with debts by exchanging the distressed debts for shares of the companies in question. It will be possible to sell distressed debts to another creditor at a discount. The feature is supposed to allow one bank to accumulate all troubled loans of one company for the sake of restructuring them in order to reduce the loan debt burden of the borrower.
Apart from that, debtors operating deep in the red may be relieved of the need to repay their debts if the lending bank writes off their debts.
The decree is supposed to reduce the volume of troubled debts of real-sector corporations as part of payments to the state budget and payments on loan contracts. The decree will also help reduce the shortage of floating assets. Belarusian banks will be able to make more effective decisions on restructuring loans and financing investment projects of the joint-stock companies, which shares they buy.
