CBO announces measures to support banks, financing firms

Muscat: Central Bank of Oman (Oman) has decided to take the following measures for the purpose of supporting the banking sector and financing leasing companies to overcome the prevailing economic conditions.

CBO has announced a stimulus package of 8 billion rials to boost liquidity in the market. To lower the Capital Conservation Buffers (CCB) by 50 percent from 2.5 percent to 1.25 percent

To increase the Lending Ratio/ Financing Ratio by 5 percent from 87.5 percent to 92.5 percent and to utilize the additional scope provided for lending/financing to the productive sector of the economy including healthcare services.

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.

Deferring the risk classification of loans pertaining to government projects for a period of 6 months. This, in reference to 030 circulars that were issued earlier.

To consider reducing existing fees related to various banking services and to abstain from introducing new ones during the year 2020.

Reduction of the interest rate on Repo operations by 75 basis points to 0.50 percent, and an increase in the tenor of Repo operations up to a maximum period of 3 months.

Reduction of the interest rate on discounting of Government Treasury Bills by 100 basis points to 1.00%.

Reduction of the interest rate on Foreign Currency SWAP operations by SO basis points, and increase in the tenor of SWAP facility up to a maximum period of 6 months.

Rediscounting of Commercial Papers as follows :

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 percent

Reduction of the interest rate on rediscounting of a Promissory Note with Acceptable Guarantee, by 100 basis points to 3.25 percent

Reduction of the interest rate on rediscounting of a Promissory Note accompanied by Trust Receipt, by 125 basis points to 3.50 percent.

 

 

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