MAS Extends Facility to Support Lending to SMEs Amid COVID-19 Crisis
MAS announced that it will extend the MAS SGD Facility for Enterprise Singapore (ESG) Loans to complement the six-month extension of Temporary Bridging Loan Program (TBLP) of ESG, from April 01, 2021 to September 30, 2021. The SGD Facility will provide SGD funding at an interest rate of 0.1% per annum for a two-year tenor to eligible financial institutions to support loans made under the TBLP and the Enterprise Financing Scheme—SME Working Capital Loan (the ESG Loan Schemes) from April 01, 2021 to September 30, 2021. MAS also published Banking (Publication and Provision of Accounts) Regulations that sets out the requirement for all banks to publish their annual balance-sheet, profit and loss account, and certain information in local daily newspapers or on banks' internet website and to make this information available to any person on request.
Since its introduction in April 2020, the MAS SGD Facility has disbursed SGD 5.7 billion to eligible financial institutions in support of their lending to companies under the ESG Loan Schemes. Taken together, the government’s risk-sharing through the ESG Loan Schemes and MAS’ lower-cost funding through the facility have helped to lower borrowing costs for local enterprises to a range of 1.5% to 3.0% per annum under the TBLP, from 6% or more for other unsecured working capital loans.
Keywords: Asia Pacific, Singapore, Banking, COVID-19, SME, Credit Risk, Lending Facility, MAS
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