Major banks in Malta have over the past few days launched a number of initiatives to support their personal and business clients during these challenging times. International banking regulatory authorities have already signaled their go-ahead for banks to to make full use, where appropriate, of the flexibility embedded in the regulatory framework to support the banking sector.
These are the key initiatives launched so far by banks licensed in Malta.
Bank of Valletta
The Bank is earmarking a fund of €10 million to be able to provide direct working capital for business customers facing cash flow issues related to COVID-19 scenario. Measures will be considered on a case-by-case basis on the particular circumstances of each business customer and include:
- Capital repayment holidays ranging from between three and twelve months
- Ease of trade finance services via internet banking at no additional cost
- Provision of direct working capital for customers facing short term cash flow issues
HSBC Malta has also put together a range of measures to support its customers, through initiatives which include the following concessions:
- Capital repayment holidays, namely short-term capital repayment holidays on term lending. Interest repayments will need to continue being made throughout the term of the concession. This will enable businesses to meet other payments until the situation reverts to normal.
- Fee free temporary short-term working capital funding. To help customers who are facing cashflow problems due to loss of business arising as a result of the outbreak, HSBC will consider fee free temporary short-term working capital funding.
- Faster turnaround on issuance of Shipping Guarantees and waiver of urgency fees. To help customers experiencing delays in receiving shipping documents from counterparties, the Bank will give issuance of shipping guarantees ‘immediate priority’, as opposed to the standard ‘same-day’ issuance. HSBC has committed itself to waive its ‘urgency fees’ in such cases. This means a customer can take transfer or receive goods from their counterparty faster without incurring additional costs.
- Waiver of amendment fees on Letters of Credit impacted by delays
During this period, customers may experience delivery disruptions resulting in the late shipment and late presentation of documents. The waiver of amendment fees on the Letter of Credit (LC) will enable customers to change the terms of the LC to avoid penalty costs when their supplier presents documents under the LC.
Since these concessions will be determined on a case by case basis, clients have been encouraged by the bank to contact their Relationship Manager who will be able to provide additional guidance on next steps.#
HSBC has also launched three initiatives to support personal customers during the emergency, namely:
- Customers holding a Home Loan or a Personal Loan can apply for a three-month repayment moratorium on their loan.
- Late payment fee for all Credit Card accounts will be waived.
- Customers may apply for a temporary increase in Overdraft or Credit Card limits subject to eligibility criteria.
Lombard Bank has informed its customers that it delay repayments for clients who have a home loan but have seen a loss of income because of the Covid-19 crisis.
The Bank will grant a 12-month moratorium on 80% of the repayments due every month, if required. While some conditions may apply, the Bank is offering these services without additional cost.
APS Bank has publicly expressed its commitment engage with customers and sectors who are being adversely affected by COVID-19 to determine if any supporting measures are required in the circumstances. Hervé Delpech, Chief Strategy Officer at APS Bank, commented that, “Being the community bank, customer and staff safety are our priority. And we want to continuously support our customers with their banking needs, especially in such times.” However, the bank has not publicly announced any specific initiatives, calling on its clients to contact the bank directly since each case would be treated on its own specific merits.