Grace periods peaked during the government's coronavirus emergency situation which ran March to May, principally due to uncertainty, restrictions imposed and a repointing of the economy.

However, through the summer the situation improved, SEB says.

"We can see that the summer generally had a positive effect on clients; to day, confidence has been gradually returning," Ainar Leppanen, SEB board member, said via a press release. 

"Most grace periods agreed upon at our bank ended at the agreed time, and clients have not considered it necessary to extend them," he added.

Around 1,600 private and business customers still have a grace period with SEB; defaulting actually fell when compared with the same period last year, the bank says.

The economy is returning to normal piecemeal, the bank says, though the hardest-hit sectors: Tourism, accommodation and catering and their related fields have not recovered and are even seeing more uncertainty, SEB says. 

"While the [coronavirus] health crisis and the decline in turnovers and profits in several sectors related to it will reverse when a solution is finally found to the virus, we have to cope also in the meantime. One of the keywords in coping with crises is always cooperation - between people, between sectors, and also between the public and private sectors. We hope that this will continue and improve further still in the future," Leppanen added.  

78 percent of grace periods went on mortgages and the remaining 22 percent on consumer credit and lease agreements (such as for cars - ed.) SEB says. 

In exceptional cases, study loans and credit card repayments can also receive grace periods, the bank says. 

As the situation started to normalize, there was an uptick in clients wanting to return to making repayments earlier than their grace period required, SEB says. 

Both state and bank actions and individual and business financial awareness and diligence was key to this recovery, SEB adds. 

A grace period or moratorium can run for up to 12 months for home loans and six months for leases and consumer credit, and up to six months for businesses with a credit limit lower than €5 million. 

Loan-holders can still apply for grace periods with SEB if their loan agreement was made before the declaration of the government's emergency situation (March 12), and this is set to run to September 29.

Criteria for eligibility include clients not having had problems with repayment prior to seeking a moratorium, and SEB says obtaining a grace period does not, and will not, affect a client's credit score.

The government's COVID-19 emergency situation ended in mid-May.

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