The Monetary Board´s Resolution JM-32-2020 issued special temporary measures to address the situation arising from COVID-19, instructing the institutions supervised by the Superintendence of Banks, to grant financing so that they can implement the temporary measures that will be in force for 180 calendar days, subject to further revision. The measurements are as follows:

• For all credit assets that, as of February 29, 2020, are not more than one month past due, the supervised institutions may review their terms and conditions in terms of interest rates and specific terms.
• The institutions may establish suspense or payment deferrals that address the particular situation of the debtor. The computation of the default indicated in article 27 bis of the Regulation for the administration of credit risk is suspended, during the validity of these temporary measures.
• The amendments may be made at the request of the debtor or the direct initiative of the institutions themselves and will not generate additional costs for the debtor.

Relevant economic aspects contained in Decree No. 12-2020 of the Congress of the Republic, Emergency Law to protect Guatemalans from the effects caused by COVID-19:

• Capital protection fund: The Capital Protection Fund administrator is Crédito Hipotecario Nacional (CHN), which is constituted with an amount of Q.250,000,000.00, destined to grant credits to individual merchants, professionals, companies, and savings and credit cooperatives, which must be placed with preferential interest rates no higher than the average of the current passive rate that governs the Guatemalan banking system (article 15, section 2).
• Fund for Micro, Small and Medium Companies (MIPYMES): The Fund for Micro, Small and Medium Companies is created and assigned to the Ministry of Economy, through the Vice-Ministry of Development of Micro, Small and Medium Companies to strengthen small and medium companies with a revolving amount of Q.400,000,000.00. Among the conditions for granting the loans, they will be placed with preferential interest rates no higher than the average of the current passive rate that governs the Guatemalan banking system, to promote the entrepreneurship of small and medium companies (article 15, paragraph 3).
• Suspense or deferral of credit obligations: Banking institutions, at the simple request of the interested parties, will be granting deferrals or suspensions on loans to debtors who are not more than one month past due. Such deferrals or suspensions will be applied, as the case may be, to credit card installments, loans with fiduciary, pledge or mortgage collateral, for two-month installments; as well as those granted to the micro, small or medium companies and any creditor of the State Institutions, for three-month installments; payments may be deferred within six months without default interest, as of the end of the COVID-19 public calamity crisis. These benefits are also applicable to people who have signed payment agreements by mutual agreement with banking institutions and who have not incurred any delay in the installments of said agreement.

For more information and advice, please do not hesitate to contact us at email: infoguatemala@dentons.com.