Support loan agreements signed
The Act on Financial Support for Small Businesses due to the COVID-19 Pandemic, no. 38/2020, of 20 May 2020, provides for a full or partial Treasury guarantee of support loans provided by credit institutions, subject to specified conditions. The above-mentioned Act authorises the Minister to negotiate an agreement with the Central Bank of Iceland, which will administer the guarantees, including their settlement, vis-à-vis the credit institutions. On 25 May 2020, the Minister of Finance and Economic Affairs and the Central Bank signed an agreement under which the Bank will handle the granting of Treasury guarantees vis-à-vis credit institutions in connection with COVID-19-related support loans to business operators. On 29 May 2020, the Ministry of Finance and Economic Affairs issued the Regulation on Support Loans, no. 534/2020.
On the basis of these, the Central Bank has signed agreements with Arion Bank, Kvika banki, Landsbankinn, and Íslandsbanki concerning Treasury-guaranteed support loans. The aim of the support loans is to maintain employment and economic activity by supporting small businesses that have suffered a temporary drop in revenues because of the COVID-19 pandemic and the associated public health measures. The agreements lay the groundwork for the implementation of the above-described pandemic response measure, subject to the conditions laid down in Act no. 38/2020, the agreement between the Ministry of Finance and Economic Affairs and the Central Bank, the Regulation on Support Loans, and the agreements between credit institutions and the Central Bank. Applications for support loans may be filed through the centralised service portal on the website island.is.
Links to further information in Icelandic:
The agreement between the Central Bank and the Ministry of Finance and Economic Affairs concerning support loans can be found here.
The Regulation on Support Loans issued by the Ministry of Finance and Economic Affairs can be found here.
The agreements between credit institutions and the Central Bank concerning support loans can be found here.
See the Act on Financial Support for Small Businesses due to the COVID-19 Pandemic, no. 38/2020.
Press release no. 21/2020
24 June 2020