BANKS will make their own decisions on loan relief depending on the circumstances, according to the Bankers Association of the Philippines (BAP), amid appeals from industry to extend the maturities on loans falling due this year.
“The extent and terms of the support will very much depend on the circumstances of the borrower and the bank,” BAP President Cezar P. Consing told BusinessWorld in a phone message Tuesday.
The Philippine Chamber of Commerce and Industry (PCCI) had appealed to banks and other financial institutions on Monday to extend loans maturing between March 16 and Dec. 31 for at least one year.
PCCI President Benedicto V. Yujuico said members of the organization were raising concerns about their “deteriorating cash positions” and warning of lay-offs.
Mr. Yujuico said companies, both large and small, were struggling to maintain liquidity while covering their operating expenses currently as the lockdown shut kept most businesses from operating.
He said restructuring loans maturing this year will help prevent job losses and business closures.
Mr. Consing, who is also the president and CEO of Bank of the Philippine Islands (BPI), said all banks will remain “supportive” of their clients and acknowledge the difficulties faced by businesses as well as individual borrowers amid disruptions caused by the lockdown measures.
“Banks realize how unique and difficult the current environment is for businesses and borrowers. Banks want to be as supportive as possible of their borrowing customers,” he said.
In early April, the government directed banks and other lenders to grant a 30-day grace period for all payments falling due within the lockdown period, which started on March 17.
The order, which was issued prior to the extension of the lockdown to May 15, provided for an automatic extension of the grace period if the enhanced community quarantine (ECQ) is extended.
The directive also ordered banks not to impose interest, fees and charges that would have accrued during the 30-day grace period on future payments and amortizations. — Beatrice M. Laforga