Complaints about conversion cannot be resolved by the deadline in which debtors must decide

The Croatian National Bank (HNB) will not be able to complete the supervision of complaints regarding the conversion of loans in Swiss francs within the timeframe in which users of these loans must make a decision on accepting the banks’ offer for conversion, it was announced on Wednesday by the HNB.

“Regardless of whether the HNB conducts supervision based on documentation or direct supervision in the bank, even with the application of the shortest legal deadlines, it cannot be validly completed in the period in which debtors in CHF must make a decision on accepting the banks’ offer for conversion. Therefore, amendments to the Consumer Credit Act do not allow debtors in CHF, who believe that the received offers for the conversion of their loans contain illegal elements, to align their decisions on accepting the offered conversion with the legal deadlines for concluding the proceedings on complaints that they have already sent or will send to the HNB. Thus, if consumers make their decisions regarding the acceptance of conversion within the legally prescribed deadline, any potential illegalities can only subsequently be the subject of a resolution by the HNB or decisions by the courts,” the central bank’s information states regarding the handling of consumer complaints related to the application of amendments to the Consumer Credit Act.

The HNB published this information “prompted by numerous inquiries about the application of the provisions on conversion from the Act on Amendments to the Consumer Credit Act and consumer complaints regarding the actions of the HNB” and explains how the HNB is obliged to act in supervision over credit institutions in accordance with applicable regulations.

The central bank explains that the HNB’s supervisory procedure, even in cases of complaints regarding the application of conversion provisions, is conducted in accordance with the Credit Institutions Act and the General Administrative Procedure Act and has its prescribed deadlines.
 

“Upon completion of supervision regarding the relevant received complaints, if it determines that consumer rights have been violated, the HNB will take legally prescribed measures and order the bank to rectify the violation, and to inform the consumer if necessary,” the information states.

It is noted that all information regarding credit institutions that the HNB obtains during supervision is classified as confidential under Article 206 of the Credit Institutions Act. However, to ensure that banks indeed act in accordance with any measures imposed, the HNB will monitor their implementation at the banks, the central bank announces.

Regarding the disputed provision of the annex to the conversion contract concerning the effects of a possible annulment of the relevant provisions of the Consumer Credit Act by the Constitutional Court, the HNB expects that all banks, which have included possible consequences for debtors in the annexes to the contracts along with the information about the initiated procedure before the Constitutional Court, will omit that provision, it concludes in the information.

According to the amendments to the Consumer Credit Act that came into force on October 1 of this year, banks were obliged to provide users of loans in Swiss francs with a calculation of the loan conversion (as of September 30, 2015) along with a proposal for a new or amended loan agreement within 45 days from the date of entry into force, meaning by November 15, and the loan user who accepts the conversion has a period of 30 days from the date of receipt of the calculation to notify the bank of acceptance.

Otherwise, the statement from the central bank in the administrative supervisory procedure for resolving consumer complaints regarding the application of conversion provisions was announced after yesterday’s meeting of Finance Minister Boris Lalovac, Justice Minister Orsat Miljenić, and HNB Governor Boris Vujčić.