1.
Stand still rules and
cooperation among lenders and
financial institutions in
restructuring
Ralf Zeitlberger
Head of Group Corporate Workout
Erste Group Bank AG 05.12.2014

2.
05.12.2014
Introduction
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In 2013 all relevant Austrian banks agreed on „Vienna rules“,
standstill rules (similar to „London rules“) after several
discussions and meetings.
- legally not binding („gentlemen‘s agreement“)
- rules stipulate first phase of a restructuring to avoid
destroying values, when liquidating a company (court
procedure)
- any contribution is the sole decision of the involved bank
(extension, haircut, interest, …)

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05.12.2014
1. Guideline
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Where a debtor is found to be in financial difficulties,
all relevant creditors should cooperate to give
sufficient time („Standstill Period“) to the debtor for
information and evaluation and for proposals.

4.
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2. Guideline
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Standstill Period:
During Standstill all creditors should not
enforce their claims to reduce their exposure
but are entitled to expect, that their position
(…reactive to others …) will not be prejudiced.

5.
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3. Guideline
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During the standstill period, the debtor should not
take any action that might adversely affect the
prospective return to the relevant creditors as
compared with the position at the beginning of the
standstill period.

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4. Guideline
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• coordination committees useful
• appointment of advisors
The interests of relevant creditors are best served
by coordinating their response to a debtor.

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5. Guideline
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Debtor should provide and allow relevant
creditors (and their advisors) timely access to all
relevant information:
- enable proper evaluation of financial situation
and proposals

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6. Guideline
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Restructuring agreement:
Proposals should reflect applicable law and the
relative position of creditors at the beginning of
the standstill period.

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7. Guideline
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Information:
• Information obtained concerning assets,
liabilities and business of the debtor and any
proposals should be made available to all
relevant creditors.
• Information should be treated confidential.

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8. Guideline
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Bridge Loan:
Always „super senior“ as compared to other
indebtedness or claims of other relevant
creditors.

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Specific guidelines for
Credit insurers
Leasing companies
Annex

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Positive and negative examples in the region
- Mercator (Slovenia)
- Baumax (Austria, CEE)
- Alpine Bau (for various reasons)
- Farmakom (Serbia)
Annex

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05.12.2014
VIENNA INITIATIVE
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• For CEE:
- EBRD
- Major commercial banks
(Unicredit Bank Austria AG, Raiffeisen Bank International
AG, Erste Group Bank AG, Intesa Sanpaolo, OTP
Bank, Eurobank, Piraeus Bank, Societe Generale,
KBC, …)
• Focus on NPL reduction to lock up banks balance sheets.
• Out of court restructuring and standstill rules one of key
measures.

14.
THANK YOU FOR YOUR ATTENTION !