Piraeus Bank announced the moratorium on mortgage installments for 12 months, while the other banks are expected to follow suit.

Piraeus Bank’s announcement

New Pricing Up-to-date Mortgages with Floating Base Rate.

Piraeus Bank, responding responsibly to the issue of the burden on family budgets from the rise in international interest rates and the broader inflationary pressures, is proceeding with the implementation of a new program to reward borrowers with up-to-date mortgage debts of variable interest rates, regardless of duration and currency.

With this program, Piraeus Bank protects consistent households from possible further future increases in the base interest rates of their housing loans (Euribor, Libor, MRO EKT etc.).

In any case, the vast majority of borrowers with housing loans in Greece were and remain consistent in servicing their obligations, making an effort to adapt to the new conditions.

The program concerns informed mortgage loans of natural persons that had already been disbursed by 31.12.22 and will be put into effect from the beginning of May 2023. It foresees compounding with the base interest rates of 31.03.23, reduced by 20 percentage points and maintained at this level for 12 months from May 2023 to April 2024.

If during the 12-month period of the program the base interest rates are reduced by the Central Banks to levels lower than those provided for in the program, then the lower interest rate will apply for the benefit of the customers.

Depending on the base interest rate and the currency of the loan, the base interest rates of the new program will be formed respectively, plus the margin provided for in the corresponding loan contracts (including contribution of Law 128/75).

For example, at Piraeus Bank, where mortgage rates are mainly based on 1-month Euribor, the base rate ceiling for informed mortgages in this category is set for 12 months at 2.72% from 2.92% as at 31.03.23 .

Corresponding adjustment of the base rates will also apply to informed mortgage loans in other currencies or with different base rates.

Individual borrowers with current variable rate mortgages will automatically join the new 12-month program, without requiring any action on their part.

As a condition of inclusion, the mortgage must be current on the date of implementation of the measure. To keep the new pricing, the loan will need to stay current for the 12 months of the new plan.

The program does not apply to fixed-rate mortgages or mortgages whose interest rate is based on the Basic Mortgage Interest Rate, as these were not affected by the increase in reference interest rates that took place in recent months.

Piraeus Bank remains alert for actions to support and reward its consistent customers, where required, based on banking criteria and best practices.