PETALING JAYA: Banks should be able to afford an interest-free loan moratorium implementation, as the industry has a relatively stable performance, says Port Klang Free Trade Zone (PKFZ) chairman Datuk Lawrence Low.(pic)

       While he lauded the government’s implementation of the moratorium under the National People’s Well-Being and Economic Recovery Package or Pemulih aid package with zero compounded interest and penalty charges, he said there should not be any interest or other charges throughout the moratorium. “Under the present condition, even if an individual is to apply for a six-month moratorium, the interest rate on the loan would be a further burden to the rakyat.

       “We understand that banks would have the risks of bad debt and capital costs. However, according to data, the banking sector still recorded objective profits and strong earnings this year, ” he said in a statement.

       Low cited examples such as Malayan Banking Bhd that recorded a 16.7% jump year-on-year (y-o-y) in its net profit to RM2.39bil for the first quarter (Q1), Public Bank Bhd up 15.1% y-o-y to RM1.53bil, RHB Bank Bhd up 13.9% y-o-y to RM650.39mil while CIMB Group Holdings Bhd posted its highest ever quarterly net profit at RM2.46bil in Q1.

       Meanwhile, Low also urged the Finance Ministry to consider a more simplified or automated method such as SMS or email for borrowers to automatically obtain eligibility for the moratorium. He urged everyone to stay home and prevent the spread of Covid-19, adding that it was not wise for borrowers to visit banks to apply for the moratorium.