KUALA LUMPUR: The Association of Banks in Malaysia (ABM) has come up in full support for Bank Negara Malaysia’s proposed moratorium on payment of interest and principal for credit facilities for six months with effect from April 1.
It said in a statement on Wednesday there would be an automatic extension of current credit facilities of six months to retail (excluding credit cards) and SME customers.
“While interest will accrue during this moratorium period, there will be no payment of interest and principal required for credit facilities for the six-month period, ” it said.
As for segments other than these the moratorium will apply on a case to case basis and customers should be in touch with their bankers to discuss the specific relief sought.
“The moratorium is the best measure to provide greatest assurance of job preservation in the midst of personal financial adjustment. We anticipate that any adverse asset quality issues will be relatively short-lived and temporary in nature, ” it said.
ABM said it fully supported Bank Negara’s pro-active measures announced on Wednesday to mitigate the economic impact caused by the ongoing Covid-19 outbreak globally.
“We are currently working out the full details of the proposals to ensure they will be efficiently executed with minimum inconvenience to customers, ” it said.
ABM said the moratorium is the best measure to provide greatest assurance of job preservation in the midst of personal financial adjustment.
“We anticipate that any adverse asset quality issues will be relatively short-lived and temporary in nature, ” it said.
Chairman of ABM, and Maybank group president & CEO, Datuk Abdul Farid Alias said, “The measures announced have been designed not only to support customers in this highly unusual global environment, but also to ensure that banks can continue to play their role in sustaining the country’s economy.
We hope it will provide customers some breathing space and allow them to focus on other critical aspects of their livelihoods at this time.”
Omar Siddiq, Officer in Charge, CIMB Group said: “Banks are fully supportive of the new measures announced today, as they are in the best interest of all stakeholders as well as the country."
Clearly, we are able to take this approach given the strength of our banking system and we will continue to balance prudence with innovation to ensure that we are flexible at all times.”
Datuk Khairussaleh Ramli, managing director of RHB Banking Group added, “The additional measures that BNM, in partnership with the banking industry have put in place, address the root of the situation that the country is currently going through as a result of the Covid-19 outbreak.
Providing critical relief to both individuals and businesses during this challenging period will ease their financial constraints and will provide them with the much needed breathing space to re-assess their financial positions, particularly those directly affected by Covid-19."
"I am confident that the measures introduced will lay a strong foundation for a faster economic recovery once the situation goes back to normal.”
Tan Sri Tay Ah Lek, managing director/CEO of Public Bank added, “These are indeed proactive measures that address immediate and key concerns of customers."
"The automatic approach will enable banks to process the moratoriums more efficiently to ensure immediate relief to those most in need."
"We have confidence that these measures will help speed up the recovery curve for the country once the pandemic is arrested and help economic activity to accelerate without any hindrance.”