Notice to existing customers
Notice to customers about the Benchmarks Regulation
This Notice is to customers of AS “Direct Mortgage Capital” (hereinafter referred to as the “Lender”). The Lender uses Euribor benchmark in its consumer mortgage loan agreements. Euribor benchmark administrator is European Money Markets Institute (EMMI) https://www.emmi-benchmarks.eu.
What is the Benchmarks Regulation?
The Benchmarks Regulation 2016/1011 is a EU regulation on indices used as benchmarks (hereinafter referred to as the “Regulation”). Among other things, it covers any index which is used to determine the amount payable under consumer credit agreements (including Euribor). The Regulation introduces a regime for benchmark administrators that will ensure the accuracy and integrity of financial benchmarks in Europe.
What is the purpose of this Notice?
After 1 January, 2020 when the requirements of the Regulation become fully binding, current benchmarks (including Euribor) may materially change or cease to be provided. The purpose of this Notice is to inform Lender’s customers whose credit agreements fall within the scope of the Regulation.
If a benchmark (Euribor) used in a credit agreement between you and the Lender materially changes or ceases to be provided, the Lender will substitute it with an alternative internationally recognized benchmark fairly balancing your best interests with those of the Lender. You will be informed by the Lender if a benchmark used in a credit agreement between you and the Lender materially changes or ceases to be provided. The Lender will also inform you what effect this situation will have on your loan.