The Franak association of debtors with loans pegged to the Swiss franc on Thursday said that anyone who had an unfair CHF loan contract had the right to sue banks based on a class action ruling, but clients who converted their loans to another currency should wait for an EU Court ruling.

The Constitutional Court ruling which upheld Commercial Court Judge Radovan Dobronic’s ruling means that 125,000 people who had unfair loan contracts in Swiss francs with a variable interest rate have the right to sue banks and be compensated for overpaid amounts, Franak’s chairman Goran Aleksic said.

About 70,000 people who did not convert their loans can immediately sue banks while about 50,000 clients who converted their CHF loans will have to wait for a ruling by the EU Court to be certain of their rights.

“Anyone who has already sued, has. These cases will probably be put on hold until the EU Court delivers its ruling,” said Aleksic, who expects that the ruling could be delivered at the end of 2021.

Anyone who sues a bank pursuant to contractual provisions being proclaimed null and void has the right to receive between 50% to 80% of their loan.

The NGO said that it has not finished its job yet. It is now waiting for the Croatian Supreme Court to decide on the nullity of these loan contracts, said Aleksic, pointing out the practice by the Supreme Court and EU Court according to which the entire contract is if the foreign currency, the price and the interest rate are void.

Aleksic noted that they still do not have the Supreme Court ruling while two final rulings had said that two loan contracts pegged to the Swiss franc were void.

‘Loans pegged to the Swiss franc caused huge human hardship’

Aleskic believes the latest ruling should have been delivered long ago, however, he said, the courts in Croatia are unfortunately “lethargic” and due to their tardiness many people lost their apartments, marriages collapsed and some people had to emigrate in order to pay off those loans.

He recalled that the State Attorney’s Office had rejected a criminal complaint against banks and ordered the County Court to launch an investigation.

The NGO’s attorney Branko Seric said that banks are being charged with a series of criminal acts, abuse of power, usurious contracts and placing debtors in an unenviable position to the extent that banks and legal entities gained from that practice, while stripping loan beneficiaries of their rights and putting them in a subservient position, and some people even committed suicide as a consequence.

According to Aleksic, citizens lost HRK 10 billion and the banks owe them HRK 20 billion, which is the amount that GDP lost. He hopes that once this money is repaid to consumers, that could be a boost for Croatia.