UAE banks have used 75 percent of the liquidity facility allocated for Targeted Economic Support Scheme (TESS), the Central Bank of the UAE (CBUAE) said.

In March, the Central Bank developed detailed regulations and guidelines for TESS and had urged banks to process more applications from individuals, corporates and SMEs whose business operations are affected by coronavirus pandemic.

This included the 50 billion dirhams ($13.6 billion) of zero-cost collateralised loans, which is now being utilised and a loosening of banks' capital buffers, in order to encourage them to adopt more lending.

Banks have availed an equivalent of 37.2 billion dirhams of the allocated funds, CBUAE said in a statement.  

Eligible customers impacted by the effects of the pandemic will not be required to pay their respective bank any installments, consisting of principal and/or interest/profit, for the agreed deferment period.

The aggregate value of all capital and liquidity measures adopted by the CBUAE under the TESS amounts to 256 billion dirhams.

“More customers are now availing the benefits from the Targeted Economic Support Scheme (TESS) liquidity facility, which provides financial relief to those affected by the repercussions of the COVID-19 pandemic,” the statement said.

THE CBUAE said that during the past two weeks additional banks have joined the scheme, increasing the total number of banks participating in TESS to 24.

“Effective next week, CBUAE will start publishing the list of banks which have availed more than 50% of the allocated TESS liquidity facility,” the statement said.

On April 23, the CBUAE announced that banks had already utilized over 60 percent of the allocated funds from the TESS facility.

(Writing by Gerard Aoun, editing by Seban Scaria)

(gerard.aoun@refinitiv.com)

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