General waivers of interest and indexation not permitted

The conclusion of a legal opinion by LEX, prepared for Gildi Pension Fund regarding fund member loans in Grindavík, is unambiguous: pension funds are not permitted to write off interest and indexation for borrowers on a general basis. The fund is permitted to give special consideration to individual circumstances. In this regard, it is noted that pension funds are not permitted to allocate funds for any purpose other than paying pensions.

Targeted measures to be considered where permitted Gildi will assess the situation of individual borrowers from Grindavík and specifically examine how those in a difficult position, based on repayment capacity and loan-to-value ratio, can be accommodated. The situation in the area remains unclear in many respects, and it is difficult to assess when such measures will be implemented. This is the conclusion of Gildi's board, based partly on the legal opinion by LEX, which addressed pension funds' authority to grant general waivers as a result of the natural disaster in Grindavík.

It is noted that the fund has already granted borrowers a six-month payment deferral. This means that instalment due dates are simply postponed, extending the loan term by up to six months. The deferral therefore has almost no effect on monthly payments once the freeze period ends.

LEX opinion – general waiver of claims