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CIMB to automatically approve most term-loan deferments of commercial clients here

CIMB Bank Singapore on Wednesday said it will automatically approve the deferment of principal and interest payments on most of the term loans taken up by its commercial banking customers here, a first in Singapore. 

This automatic moratorium will exclude restructured and rescheduled accounts, as well as non-performing loan accounts, said a spokesman.

But beyond that, most qualifying commercial banking customers should therefore be "automatically pre-approved" for the deferment of both principal and interest on all term loans, regardless of the level of security or collateral. The deferment is for up until Dec 31, 2020. 

The scheme is a further extension of the Special Relief Financial Programme that CIMB Bank Singapore will offer in accordance to the Monetary Authority of Singapore’s (MAS) guidelines on small- and medium-sized enterprises (SMEs) financing issued on Tuesday. Under the latest MAS measures, banks and finance companies must allow deferments through to the end of the year, but this is limited on the corporate front to principal repayments of secured corporate loans of SMEs.

The bank will also grant automatically to most of its commercial banking customers an extension of all trade bills maturing between April 1, 2020 and June 30, 2020, for up to 180 days. It will as well grant an additional 90 days to the existing approved tenure for fresh drawings of trade bills, with this covering all new drawings on or before June 30, 2020.

In a press statement, Victor Lee, chief executive of CIMB Bank Singapore, said: “It is no longer about the ability to pay for most, it is about the need to preserve cash flows to tide through this period to ensure survival...This is the time we put aside our quest for revenue generation and look at how as a bank, we can offer a lifeline to our customers."

CIMB Bank Singapore told BT in October 2019 that it has held a 3 per cent market share in the SME banking business in Singapore. It said then it planned to double its market share to 6 per cent by 2021.

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