MUSCAT: The Central Bank of Oman on Wednesday issued control measures to help banks and finance leasing companies to overcome the current economic crisis.
According to the circular issued by CBO to all the banking institutions, these are the measures prescribed:
For the purpose of supporting the banking sector and financing leasing companies to overcome the prevailing economic conditions, Central Bank of Oman has decided to take the following measures from the issuing date:
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- To lower the Capital Conversation Buffers(CCB)by 50 percent from 2.5 percent to 1.25 percent
2. To increase the Lending Ration/ Financing Ration by 5 percent from 87.5 percent to 92.5 percent and to utilize the additional scope provided for lending/ financing to productive sector of the economy including healthcare services.
3. To accept requests for deferment of loan instalments/ interest/profit for affected borrowers particularly SMEs with immediate effect for the coming 6 months without adversely impacting the risk classification of such loans.
4. Deferring the risk classification of loans pertaining to government projects for the period of 6 months.This, in refence to CBO circulars that were issued earlier.
5.To consider reducing existing fees related to various banking services and to abstain from introducing new ones during year 2020.
6.Reduction of the interest rate on Repo operations by 75 basic points to 0.50 %, and increase in the tenor of Repo operations up to a maximum period of 3 months.
7. Reduction of the interest rate on dicouting of Government Treasury Bills by 100 basis points to 1.00%.
8. Reduction of the interest rate on Foreign Currency Swap operations by 50 basis points, and increase in the tenor of SWAP facility up to a maximum period of 6 months.
9. Rediscounting of Commercial Papers as follows:
a) Reduction of the interest rate on rediscounting of a Bill of Exchange and Promissory Note(with 2 signatures,by 100 basis points to 3.00%.
b) Reduction of the interest rate on rediscounting of a Promissory Note with Acceptable Guarantee by 100 basis points to 3.25%
c) Reduction of the interest rate on rediscounting of a Promissory Note accompanied by Trust Receipt , by 125 basis points to 3.50%.
