On 1 January 2021, the new definition of default, introduced by Article 178 of CRR (EU Regulation no. 575/2013, as amended), entered into force. It concerns the way by which intermediaries classify their clients for prudential purposes. In this respect, the Bank of Italy has recently clarified that the new rules:
- will neither affect the reporting to the Central Credit Register Data, nor imply a ban on the granting of overdrafts; and
- may have an impact on the intermediaries’ contractual relationships with their clients.
Therefore, the former must inform their clients about the afore-said implications, by contacting them individually, in order to prevent the occurrence of defaults not caused by debtors’ financial difficulties.
#legalnews #eulaw #italianlaw #bankinglaw #Bankitalia #update