Banks could face modification loss of RM4.4b on HP instalments

Least affected would likely be Alliance Bank and BIMB

KUALA LUMPUR: Maybank Investment Bank Research estimates the one-off “Day One” provision, or modification loss under MFRS 9, following the banks’ decision not to charge additional interest on hire-purchase (HP) instalments, could be about RM4.4bil.

It said on Friday the decision which is over the six-month loan moratorium period (April to September 2020) is positive to consumers but it comes at a cost to the banks.