Lease obligations restructuring options for business customers

We are interested in the long-term stability of our clients, therefore we always seek ways to restructure existing loans in order to resolve the problematic situation together with the client and help the company overcome short-term difficulties as much as possible.

Swedbank’s priority is sustainable businesses, which is the driving force behind overall economy.

Crucial factors include your – the company owners’ – openness, co-responsibility, desire to deal with problems and being interested in the company’s long-term viability. Other important considerations include company’s capacity for swift readjustment and prompt decision-making in today’s changeable market conditions, and transparency of the company’s financial data.

How to handle problems with maintaining leasing payments?

Getting in touch with the bank as soon as possible is most crucial!

• Arrange a meeting with the bank officer, who manages your company’s loan at the bank, to review the terms of finance. If you don’t know who the bank officer, who manages your company’s loan, is you can find that out by calling the information line on 67444445.
• Finding that out is free of charge.
• Change of terms of lease will cause a smaller increase in the margin rate if you approach the bank early than in case lease payments fall overdue and bank’s official is force to initiate restructuring of lease obligations.
• It should be taken into account that reviewing each customer’s case according to the bank’s decision-making procedure may take more time than expected (up to three weeks and in some cases even more).

Why should the bank be contacted??

• The bank manager will recommend the most suitable solution for overcoming solvency difficulties depending on your company’s actual cash flow, the value of leasing collateral and other conditions – with a view to easing your company’s cash flow and supporting lease repayments in the long-term.
• The bank manager will tell you about Swedbank’s principles of pricing for leasing and about potential change in interest rates in connection with revised terms of finance.

What does restructuring of lease obligations mean?

• The restructuring of lease obligations means changes in lease repayment terms, as initiated by you and approved with the bank manager (such as extension of lease period, postponement of lease payments, and other measures), so as to improve the company’s solvency.

Swedbank currently offers the following solutions:

• postponement of principal repayments;
• extension of period;
• change of schedule (annuity / amortization or special schedule change when repayment is seasonal or transaction based);
• refinancing of obligations
• raising additional collateral and/or combining of contracts;
• selling off unprofitable assets;
• transferring obligations from company to individual (in small-sized enterprise segment)

What will be the interest rate on lease after restructuring?

• Although the price of money has surged several times, Swedbank, being a socially responsible company, is in such cases ready to absorb some of the costs.
• The maximum loan rates are fixed on transactions with business customers, according to which loans, that meet the bank’s loan approval procedure requirements, are priced.
• The bank shows goodwill to companies, where possible agreeing on such a combined interest rate that would allow keeping the total monthly payment at the level of previous periods (especially EUR loans, which forms the majority of loans).
• Every solution is tailor-made to befit every specific case and in all events focusing on preserving customer’s financial strength in the long-term.

How will the company benefit from restructuring lease obligations?

• Continued business operations
• Positive credit history
• The goal is smaller monthly lease payments as a result of lease restructuring.
• Repayment schedule, final repayment date and proportionate interest payments appropriate for the company’s existing and reasonably expected cash flow.

What documents are to be presented to the bank to start dealing with problems to maintain leasing payments?

It is important to get in touch with the bank official, who manages your company’s loan at the bank, to find out what is necessary in your specific case of loan obligations restructuring.

Key documents:

• Financial documents (balance sheet, P/L statement for the previous financial year and the current year’s operating financial data).
• Cash flow statement.
• Other documents, which are essential in re-assessing the company’s creditworthiness (e.g. the company’s cooperation agreements, collateral documents).

Who will explain the decision taken?

• • All your questions about the decisions made should be directed to the bank officer who manages your company’s loan.