Important Information for ACCBank SME Customers

1.         What is the ‘Code of Conduct for Business Lending to Small & Medium Enterprises’?

The Code of Conduct for Business Lending to Small & Medium Enterprises was first established by the Central Bank of Ireland in February 2009, to set out the processes Banks are required to adopt, to facilitate access to credit for business.

A revised version of the Code of Conduct for Business Lending to Small and Medium Enterprises (“the Code”) was published in November 2011 and took effect from 1st January 2012. In addition to the 2009 requirements, the revised Code sets out new requirements for Banks when dealing with small and medium enterprises (SMEs) in, or facing financial difficulties. The Code builds on the Central Bank of Ireland’s ongoing programme of work of protecting the interests of borrowers in, or facing arrears, the aim of which is to assist borrowers meet their obligations or where that is not possible, to otherwise deal with the situation in an orderly and appropriate manner.

2.         How does it work?

It is very important that you should contact the Bank when:-

• you feel that you might not be in a position to provide for your loan repayments, and/or
• you have already had some problems in providing for your loan repayments and may be experiencing some repayment arrears on your loan facilities.

The sooner we know about the problem, the sooner we can examine your individual circumstances and work with you towards agreeing an appropriate plan to clear the arrears and/or explore alternative repayment options. We will endeavour to work with you to try and identify a mutually acceptable, sustainable solution to your financial difficulties. It is however very important that you fully engage and co-operate with us to address your financial difficulties within the framework set out in the Code.

3.        What can you expect from us?

• First missed payment: We will send you a letter outlining key information including the unpaid amount and the applicable fees and charges on approximately Day 7 in arrears.

• Arrears unpaid: If the arrears continue, we will send you further correspondence on approximately Day 31 in arrears.

• You may receive further correspondence advising that your account remains in arrears.

• Financial Difficulties (approximately 90 days in arrears): We will send you a letter advising you of the applicability of the Code.

Your case may be transferred to our Special Asset Management (SAM) unit where it will be managed. Alternatively, day to day management may remain with your local Business Centre, under guidance from SAM. If your case is passed to a SAM team for management, we will write to you to advise you of this.

We may require a meeting to discuss your position:

• An inspection/visit of your business may be carried out.
• Minutes of meetings will be taken and held on your file.
• Following meetings with you, where agreements are reached on the information we require and the actions and steps to be taken by both parties, we will document same and forward in a letter to you to formalise the position agreed.
• We will carefully review the information (see below) you provide to us and a report will then be completed and submitted to the appropriate discretionary authority within the Bank for decision.
• All decisions made regarding our requirements on the future operation of your loan accounts will be conveyed promptly to you and/or your advisers in writing, and within 15 business days of receiving all information from you.
• Where applicable, you will be advised of any offer of an alternative repayment arrangement and any conditions of sanction attaching in formal loan sanction letters.
• Where you fail to adhere to the terms of an alternative repayment arrangement on ongoing basis, or if it is evident that there is no reasonable or sustainable basis upon which to reach an acceptable solution for all parties involved or where there is evidence of fraud or misrepresentation, and/or if the business is unable to meet its financial obligations from trading, debt repayment will be required from an orderly sale of the business and/or the realisation of any assets given as security to the Bank for advances made.
• Where you cease to honour your obligations to the Bank by either refusing to deal promptly with your financial difficulties or withdraw from co-operating with the Bank, the necessary steps will be taken to protect our position. You will be advised in writing of the consequences of such steps, as appropriate. 

4.        What type of information might the Bank require from you?

Once you have contacted us we will strongly advise that you arrange to meet with us to discuss your individual circumstances. The type of information we will require will depend on your individual circumstances, the nature of your business, and whether you are an individual, partnership, or an unincorporated or incorporated body. Below are details of the type of information which we may request to assist in assessing your case:

• Business plan with a proposal for dealing with financial obligations outstanding
• Copies of recent financial accounts
• Copies of recent management accounts
• Copies of the last three years personal/partnership or corporation tax return forms, as filed with the Revenue Commissioners
• Details of outstanding tax returns and unpaid taxes
• Details of any capital gains or losses realised in the current tax year or expected to be realised in the future
• Details relating to any property held as security.
• Up to date aged debtor and/or creditor listings
• Up to date certified statement of affairs including details of all income.
• Up to date independent valuation of any security held by the Bank.
• Bank loan, current account or credit card statements.
• Details of repayment agreements with other credit providers.
• Details of any revenue arrangements.

The above is not an exhaustive list and depending on the type of Business you are in, other information requirements may be necessary.

Depending on your individual circumstances, the Bank may explore a number of options with you for alternative repayment arrangements which may include:-

• An interest only arrangement for a specified period
• An arrangement to pay interest and part of the normal capital element for a specified period
• Deferring payment of all or part of the instalment repayment for a period where, for example, there is a temporary shortfall of income.
• Extending the term of your facilities, where this could make a significant difference to the monthly repayments.
• Rescheduling the arrears and interest where there is insufficient capacity over the short term to clear the arrears but where repayment capacity exists to repay the capitalised balance over the remaining term of the loans.
• Revised loan conditions.
• Revised pricing.
• Revised security.

5.        Appeals

If your request for an alternative repayment arrangement is declined, or if you are unwilling to enter into an alternative repayment arrangement offered to you, you will have a period of 20 working days (from the date you were first advised of this decision), to submit an appeal. The appeal should preferably be in writing, for reasons of full clarity. The appeal will be independently reviewed by our Appeals Board which will consist of senior members of staff who were not previously involved in the decision on the original application. This will ensure that a fresh perspective will be obtained on your request. We will provide a written response on the outcome of your appeal to you and / or your nominated advisor within 15 days of the receipt of your appeal.
At all times you are entitled to make a complaint in relation to our process in relation to the Code. Any complaint should be directed to our Customer Liaison Unit who will process it in full accordance with the provisions set out in the Code and the Bank’s complaints procedures.

6.         Other Important Information for Customers

Full details of the Bank’s Fees & Charges are available under ‘Useful Links’ on the Bank’s website (http://www.accbank.ie/useful-links/guide-fees-and-standard-charges). This also includes information on how to minimise fees and charges which includes:

• Use Electronic Business Banking: The Electronic Business Banking (EBB) facility will allow you on-line access to your current account so that you can reconcile and manage your account to reduce significant referral charges and surcharge interest.
• Check your cheques: When you write a cheque make sure that all of the details are completed correctly, and that there are sufficient cleared funds in your account to avoid any potential unpaid cheque charges.
• Keep good records: It is important that you retain all statements and other documents relating to your accounts safely so that you are not charged for duplicate copies. It is important to retain your cheque books in a secure place so there is no requirement to request stops to be placed on cheques should you be unable to locate the cheque book.
• Plan ahead: If you don’t have an overdraft facility, make sure you maintain a credit balance on your account. If you do have an overdraft and you know it is likely to exceed your limit, then apply for an increase in your existing overdraft facility well in advance.  If we agree to the increase you will avoid unnecessary referral charges and surcharge interest.

Detailed below, (for indicative purposes only) are some of the key charges which you may be liable for as a result of an arrears position, or not having sufficient funds in your account to meet payments:-

Please Note:

• Your credit rating may also be adversely affected by arrears/financial difficulties on your account, which may impact your ability to access credit in the future.
• Financial difficulties on one of your facilities may negatively impact on other facilities which you have with us.
• Nothing in the Code prohibits us from acting with all necessary speed:
  • where in the circumstances of the case it is necessary to initiate a liquidation, receivership, examinership or similar insolvency event or where another Bank or third party initiates such actions;
  • where it is necessary that we protect our legitimate commercial interests;
  • where there is reasonable evidence of fraud, terrorist connections, money laundering and/or misrepresentation,
• and the provisions of the Code are without prejudice to our regulatory and/or legal obligations and legal rights to enforce an agreement including any security taken in connection with any agreement.

It is our intention to work with you in respect of any Financial Difficulties you have with us. Our objective is to agree a mutually acceptable repayment arrangement with you to deal with these difficulties. Accordingly, it is very important that you approach us as soon as you become aware of such difficulties and that you propose reasonable and realistic repayment solutions, if you can. Furthermore, it is also very important that you engage fully with us at all times, and that you provide all information as and when requested.  This will facilitate a prompt review of your case.