KUALA LUMPUR: Malaysia’s six largest banks have reported that loans under Covid-19 pandemic-related repayment assistance increased to an average of 27% of total loans between July and August 2021 from 12% in March to May.

       This was driven by the retail and small and medium enterprise segments, after Bank Negara expanded the programme to support a wider group of borrowers alongside the extension of the lockdown in June, said Moody’s Investors Service.

       “Although this will result in a deterioration in banks’ asset quality, we do not expect non performing loans to increase sharply because most of the scheme’s applicants are likely to have sufficient financial capacity to repay their debt when the programme ends,” it said. — BernamaIn