Money

ASF, COVID19-hit banks get regulatory relief from BSP

Some form of help is coming for banks and borrowers hit hard by the African swine fever as well as the coronavirus outbreak.

Some form of help is coming for banks and borrowers hit hard by the African swine fever as well as the coronavirus outbreak.

The Bangko Sentral ng Pilipinas (BSP) has extended regulatory relief to banks and quasi banks (QBs) which have incurred losses due to exposures to “borrowers, industries and sectors severely affected” ASF and COVID-19.

This means there won’t be pressure for these banks to pay their dues and follow strict credit standards set by the regulator.

“This is in recognition of the potentially crippling impact of these events on key industries. We believe that the grant of regulatory and rediscounting relief measures is also applicable to financial institutions whose clients have suffered from adverse effects of these crises,” BSP Governor Benjamin Diokno said in a statement.

Banks proven in possible peril would be allowed staggered booking of allowance for credit losses, non-imposition of penalties on legal reserve deficiencies, and non-recognition of certain defaulted accounts as past due.

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