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MBSB Bank assures customers no charge for Covid-19 MCO-related moratorium on loans

MBSB Bank president and chief executive officer Datuk Seri Ahmad Zaini Othman said the bank understands that Malaysians currently have many concerns, with regards to health, declining income and other uncertainties that shall continue to linger. — Reuters pic
MBSB Bank president and chief executive officer Datuk Seri Ahmad Zaini Othman said the bank understands that Malaysians currently have many concerns, with regards to health, declining income and other uncertainties that shall continue to linger. — Reuters pic

KUALA LUMPUR, June 4 — MBSB Bank announced today that it will not be charging its customers for any costs related to the automatic moratorium as part of offering financial relief to its retail, corporate and small and medium enterprise (SME) clients affected by Covid-19 and phases of the movement control order (MCO).

MBSB Bank president and chief executive officer Datuk Seri Ahmad Zaini Othman said the bank understands that Malaysians currently have many concerns, with regards to health, declining income and other uncertainties that shall continue to linger.

“As an Islamic bank, it is only just that we fully absorb these charges,” he said in a statement.

The statement explained that charges associated with the automatic moratorium relate to the modification loss that MBSB Bank has to incur for its fixed rate financing accounts.

As at December 31, 2019, the bank has approximately RM19.0 billion or 56 per cent of fixed rate financing assets, largely comprising its Personal Financing-i (PF-i) granted to government servants. The monthly payment is then collected from the workforce through salary deductions.

MBSB said its SME customers who are currently enjoying the Industrial Hire Purchase based on fixed rate financing shall also benefit from this move.

“With the deferment of six months’ payments, MBSB Bank shall then extend the financing tenure by another six months. Except for the auto financing accounts, customers do not need to provide consent for the extension as the selling price for the commodity used under the Islamic concept of Tawarruq, does not change.

“Customers can also continue with the same monthly payments post-moratorium. Only those who wish to opt-out of the moratorium need to contact MBSB Bank by the end of July,” read the statement.

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