Companies have been experiencing a true way of the cross since the Covid-19 pandemic broke out last March and all the forecasts made by the companies were carried away. The lack of liquidity was, from the beginning, the main agony for companies, which saw deadlines to pay salaries and other current expenses expire and did not have the treasury with which to meet their obligations. Data from the Ministry of Economic Affairs and Digital Transformation that take stock of the ICO Guarantee Line that the Government activated last year to respond to this distressing lack of liquidity they show the harsh reality that the business fabric is experiencing.
Almost 40% of the companies in the province of Castellón had to resort to the Official Credit Institute (ICO) last year to be able to face the problems derived from the lack of liquidity. A total of 6,863 companies of the province of Castellón received funding, details the Ministry of Economic Affairs and Digital Transformation.
Total, 11,798 operations were approved in the Castellón regions that benefited 6,863 companies to meet their liquidity needs through the ICO Guarantee Line with a financing of 1,868.9 million euros and a requested guarantee of 1,391.7 million, informs the Ministry.
It should be remembered that Royal Decree-Law 8/2020 of March 17 in article 29 approved a State Guarantee Line of up to 100,000 million euros, from the Ministry of Economic Affairs and Digital Transformation, to facilitate the maintenance of employment and alleviate the economic effects of the health crisis. The guarantees would be granted to financing granted by financial entities to facilitate access to credit and liquidity to companies and self-employed workers to face the impact of Covid-19.
At set of the country, Spanish companies received last year 114,647 million euros of financing to meet its liquidity needs through the ICO Guarantee Line. 944,588 guaranteed loans were approved with a guarantee of 87,085.8 million euros.
The medium financing Per transaction it has been situated at 121,373 euros in the country as a whole and the average term is 53 months. In the province of Castellón, the average financing per operation is higher, since it stands at 158.404 euros, while the term is slightly lower than the state average, with 51 months.
The Ministry collects in its balance sheet of the ICO Guarantee Line that 6,863 companies in the province opted for these aids in 2020. The data supposes almost 40% of the total tissue provincial business, since the latest data from the Sustainable Economy Ministry for the fourth quarter of 2020 put the number of companies registered with Social Security at 18,555. For this reason, in particular, 37% of the companies in Castellón have opted for ICO financing.
Despite this line of guarantees, many companies already fell by the wayside last year due to the effects of the pandemic on economic activity. The total number of companies registered with Social Security in the province of Castellón stood at 18,555 in the fourth quarter of 2020, which represents a decrease of 92 compared to the previous quarter, representing a percentage drop of 0.5%. During the past 12 months, the decrease in the number of companies in the Castellón regions it reaches the figure of 417, that is to say 2020 closed with 2.2% less of companies registered with Social Security in the province of Castellón than in 2019, details the Ministry.
In the autonomous area, the decrease in the total number of companies registered with Social Security has been greater, since the Valencian Community stood at 145,283 in the fourth quarter of 2020, which meant a drop of 693 (-0 , 5%) compared to the previous quarter, and a decrease of 4,462 (-3%) compared to the same quarter of the previous year.
LONGER PERIOD OF RETURN OF CREDITS
The big problem posed by companies is that, obviously, the credits will have to be repaid and, as time passes, the pandemic and its effects continue to devour the economic fabric. For the moment, the Government has extended the repayment period for ICO credits, whose return was originally scheduled for next March.
However, a large number of companies had already warned that they would not be able to meet the quotas due to the lack of income, especially in the tourism and hospitality sectors, with what start paying back in March it would have created a new difficulty for these companies, leading them to default and bankruptcy.
For this reason, the Executive approved last November a Royal Decree Law by which the possibility of subscribing the credits with the ICO guarantee was extended until June 30, 2021. the grace period is also extended, so that companies, SMEs and the self-employed have up to three more years, up to a maximum of 8, to repay these loans. Previously, ICO credits, granted by financial institutions and guaranteed by the Government, to maintain liquidity in the worst moments of the pandemic, had a 12-month grace period.
It should be remembered that in this same Royal Decree the suspension of the duty to request the declaration of bankruptcy was also extended until March 14, 2021, as well as the obligation of the judge to admit the applications for processing. A postponement that has caused 2020 to have closed with fewer bankruptcies in the province of Castellón than in 2019 despite the Covid pandemic.
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