By Biz Times
BANKS will emerge the biggest winners from a proposed move to ease customers’ housing loan payments.
Banking analysts contacted yesterday said home financing is a major business for most major banks and extending the loan tenure by even a minimum of one year could bring more income for the banks.
However, not many customers will opt for this “aid” as a longer loan tenure means extra burden.
“As it is, the duration of mortgage loans is usually up until the borrowers are 60 to 65 years old, and by adding an extra five to 10 years to that is undesirable,” one analyst said.
He added that most banks have already put in place a mechanism to help their customers restructure their loans on a case-by-case basis.
One such bank is Malayan Banking Bhd (Maybank), which has welcomed the call by the government for banks to assist borrowers with payment plans.
“Although we have not advertised the additional financial assistance, we have been offering our customers the flexibility to restructure or reschedule their financing on a case-by-case basis to ensure they are able to continue to meet their financial obligations,” said Maybank chief executive officer Datuk Seri Abdul Wahid Omar.
He said the bank will continue to engage with its customers and monitor the current position with a view to providing additional financial advisory services to customers in need of such assistance.
Second Finance Minister Tan Sri Nor Mohamed Yakcop told the Dewan Rakyat on Wednesday that the Finance Ministry is in discussions with banks to reduce the monthly repayments for housing loans to lessen the financial burden of the lower-income group.
Another analyst admitted that such a scheme would most likely attract low-income earners with housing loans of RM100,000 and below.
“This new arrangement can help banks reduce their cost in managing possible non-performing loans by this group of income bracket,” he said
