Deal allows for write-offs and restructuring

Struggling borrowers will be able to avail of debt write-offs and restructure their loans under a deal agreed with the Central Bank, financial institutions, and credit card companies.

The latest initiative to solve the mounting crisis was announced on the same day the Central Bank revealed banks wrote down €400m of household loans over the final three months of 2012.

The purpose of the pilot scheme is to take the pressure off borrowers who owe money to multiple lenders — including banks, credit unions, and credit card companies. It is aimed at distressed borrowers who do not qualify for a personal insolvency arrangement.