Featured Product

    QCB Announces Measures to Address Impact of COVID-19 Outbreak

    May 20, 2020

    QCB issued a package of instructions for financial institutions operating in the State of Qatar to ease the impact of COVID-19 outbreak. The package of instructions cover guidance on business continuity plans, repayment of loan installments, national guarantee program, management of Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) risks, and certain other areas of concern. QCB also published a presentation on procedures to combat the risk of COVID-19 pandemic.

    Repayment of Loan Installments

    All banks and finance companies that operate in Qatar shall postpone the repayment of loan installments due and interest/returns on those loans for the affected sectors, for a period of six months from March 16, 2020, for desiring customers with low interest/return and without charging any commissions or delayed fees and without any adverse impact on their credit rating. A repurchase window (repo) with an amount of QAR 50 billion, at a zero interest rate, has been a;sp allocated for providing liquidity to banks at zero cost. This will enable banks to commit to reducing the interest/return rate for customers of the affected sectors and for those who benefit from the decision to postpone repayment and the sanctioning of new loans without fees or commissions to clients of the affected sectors with an interest/interest rate not exceeding 1.5%. This is in case these loans are repriced after the end of a period of six months as from March 16, 2020 or the end of the repo facilities or by a notice from QCB, whichever being announced first. These instructions are effective as from the issuance date.

    National Guarantee Program to Support Private Sector

    In response to the COVID-19 outbreak, QCB decided to launch a national guarantee program to support private-sector companies affected by the current conditions to enable them to obtain the necessary and immediate finance needed to pay the salaries to their employees and pay rents, if any. Qatar Development Bank will manage the National Guarantee Program to support the private sector and issue the related guidance in this regard. According to the national guarantee program, the concerned banks must accept the finance applications submitted to them by beneficiary companies and the benefits shall be granted according to the following conditions and guarantees:

    • The maximum funding limit for a single company and its group of subsidiaries is QAR 7.5 million, payable over three months, with a maximum of QAR 2.5 million per month.
    • The provision is for a guarantee of 100% of the total financing by the Qatar Development Bank on behalf of the Government of Qatar, without the relevant banks bearing any fees or commissions.
    • Finance is to be paid over a maximum of three years, starting from the last installment of finance, so that the first year will be a grace period. 

    In addition, the following conditions have been specified for how banks can calculate interest or return on balance of the finance:

    • At a rate not exceeding 1.5% for the first six months (the grace period) to be paid by Qatar Development Bank and borne by the government of the State of Qatar. during the second half of the first year (grace period)
    • During the second half of the first year (grace period), the interest is calculated at a rate not exceeding (1% + QCB Lending Rate) from which the Qatar Development Bank pays a value of 1.5% and is borne by the government of the State of Qatar and any excess over 1.5% shall be paid by the customer.
    • During the remaining two years, at a rate not exceeding (2% + QCB Lending Rate) borne by the customer and paid with monthly installments.

     

    Related Links

    Keywords: Middle East and Africa, Qatar, COVID-19, Banking, AML/CFT, Credit Risk, Loan Guarantee Loan Moratorium QCB

    Featured Experts
    Related Articles
    News

    EBA Analyzes Impact of Unwind Mechanism of Liquidity Coverage Ratio

    EBA published a report analyzing the impact of the unwind mechanism of the liquidity coverage ratio (LCR) for a sample of European banks over a three-year period, from the end of 2016 to the first quarter of 2020.

    November 19, 2020 WebPage Regulatory News
    News

    ECB Outlines Views on Possible Changes to AnaCredit Rule and TLTROs

    In response to questions from a member of the European Parliament, the ECB President Christine Lagarde issued a letter clarifying the possibility of amending the AnaCredit Regulation and making targeted longer-term refinancing operations (TLTROs) dependent on the climate-related impact of bank loans.

    November 19, 2020 WebPage Regulatory News
    News

    IASB Begins First Phase of Post-Implementation Review of IFRS 9

    IASB started the post-implementation review of the classification and measurement requirements in IFRS 9 on financial instruments and added the review as a project to its work plan.

    November 18, 2020 WebPage Regulatory News
    News

    FSB Report Examines Progress in Resolvability of Systemic Institutions

    FSB published a report that examines progress in implementing policy measures to enhance the resolvability of systemically important financial institutions.

    November 18, 2020 WebPage Regulatory News
    News

    EBA Benchmarks National Insolvency Frameworks Across EU

    EBA published a report on the benchmarking of national loan enforcement frameworks across 27 EU member states, in response to the call for advice from EC.

    November 18, 2020 WebPage Regulatory News
    News

    FSB Reports Assess Impact of Pandemic on Financial Stability

    FSB published a letter from its Chair Randal K. Quarles, along with two reports exploring various aspects of the market turmoil resulting from the COVID-19 event.

    November 17, 2020 WebPage Regulatory News
    News

    RBNZ Consults on Implementation of Capital Review Changes

    RBNZ launched a consultation on the details for implementing the final Capital Review decisions announced in December 2019.

    November 17, 2020 WebPage Regulatory News
    News

    IASB Announces Andreas Barckow as the New Chair from July 2021

    The Trustees of the IFRS Foundation, which are responsible for the governance and oversight of IASB, have announced the appointment of Dr. Andreas Barckow as the IASB Chair, effective July 2021.

    November 17, 2020 WebPage Regulatory News
    News

    HKMA Consults on Capital Rules for Bank Equity Investments in Funds

    HKMA issued a letter to consult the banking industry on a full set of proposed draft amendments to the Banking (Capital) Rules for implementing the Basel standard on capital requirements for banks’ equity investments in funds in Hong Kong.

    November 17, 2020 WebPage Regulatory News
    News

    ESRB Supports Extension of Macro-Prudential Measure by Swedish FSA

    ESRB published an opinion assessing the decision of Swedish Financial Supervisory Authority (FSA) to extend the application period of a stricter measure for residential mortgage lending, in accordance with Article 458 of the Capital Requirements Regulation (CRR).

    November 17, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 6153