On 31 January 2020, the World Health Organization has announced
the outbreak of novel coronavirus (2019-nCov), sourced from Wuhan,
as a Public Health Emergency of Concern. The impact of the
coronavirus outbreak, social distancing measures implemented by the
PRC governments and the WHO's declaration of a public health
emergency of international concern further extends to the finance
sector.
1.1 Lender
A typical situation a lender might be facing is where there is
no occurrence of an actual event of default, but due to the
coronavirus outbreak, they could smell that a default will occur by
lapse of certain time. What can they do?
In the PRC, under a recent government notice (the
"Notice 29")1, banks were
required not to blindly suspend, terminate or delay distribution of
any loan to any borrower which is materially adversely affected by
the coronavirus outbreak (e.g. borrower in the wholesale, retail,
accommodation, logistics, cultural or tourism industry) or
