KUALA LUMPUR, Feb 11 — An automatic blanket moratorium would not be in the best interest of the economy and the people (rakyat), said Bank Negara Malaysia governor Datuk Nor Shamsiah Mohd Yunus.
“Firstly, it will erode banks’ buffers and make it difficult for individuals and businesses to obtain new loans.
“Secondly, banks’ soundness and profitability matters for millions of Malaysians, who are not only depositors in the banks but actually shareholders, directly (in terms of) their savings, and holdings in institutions like Employees Provident Fund, Amanah Saham Bumiputera, Retirement Fund (Incorporated), Lembaga Tabung Angkatan Tentera and Tabung Haji.
“Thirdly, the targeted approach is better than an automatic blanket moratorium as it puts the choice in the hands of borrowers, (allowing them) to make their own financial decisions,” she told reporters during the virtually-held media conference to announce the fourth quarter of 2020’s gross domestic product (GDP) today.
Nor Shamsiah said 1.4 million Malaysians have applied for the repayment assistance, with the approval rate at 95 per cent, adding that about 45 per cent of the borrowers are opting for a reduction in monthly instalments.
“Borrowers are making informed choices on managing their debts based on what they can afford. So, they are not asking for moratorium, they don’t want a one-size-fits-all solution,” she added.