RHB, Maybank waive compounding of loan interest during moratorium

PETALING JAYA: RHB Banking Group will not be compounding interest during the six-months repayment moratorium that was announced by Bank Negara Malaysia on March 25.

In a statement, RHB said this would only apply to retail and SME customers, with effect from April 1. For Islamic financing, RHB will continue to observe the principle of no compounding of profit.

“The moratorium will apply automatically to all RHB Bank and RHB Islamic Retail and SME customers, with the exception of loans/financing facilities that are in arrears exceeding 90 days as at April 1, 2020,” it said.

Meanwhile, for credit card facilities, customers may request to convert outstanding balances into a 3-year term loan with reduced interest rates.

RHB group managing director Datuk Khairussaleh Ramli said further details on the repayment deferment and restructuring has been made available on the group’s corporate website.

““These additional measures introduced by BNM in partnership with the banking industry provides critical relief to ease the financial burden of individuals and businesses, particularly the SMEs during this extremely challenging period,” he added.

Meanwhile, in a separate statement, Maybank also said it will not be compounding interest for all

individual, SME and non retail/corporate customers loan facilities which are eligible for the 6-month moratorium.

“In these extraordinary times, Maybank believes that all its customers, be they individuals or businesses, are facing unprecedented challenges.

“The bank hopes that with this additional measure, it will be able provide them further relief from their financing obligations for this period and help them weather the other challenges they may be facing,” it said.

According to the group’s statement, the eligible products under the automatic scheme for retail and SME clients include personal, mortgage, ASB, education and SME loans. Fixed-rate hire purchase loans already do not have compounding interest.

“All retail and SME customers do not need to apply for the moratorium as it will be automatically applied to all eligible loans and financing. For all Islamic financing facilities under the group, profit rates are already not compounded in line with Shariah principles,” it added.

Eligible non-retail/corporate customers will, however, need to submit the required application for moratorium through their relationship managers or corporate bankers.

source https://www.thesundaily.my/business/rhb-maybank-waive-compounding-of-loan-interest-during-moratorium-EN2186024