IPOH, July 7 (Bernama) -- Bank Negara Malaysia's (BNM) new rules
restricting personal and property loans to a maximum loan period, will
not impede domestic growth, as it has a primary basis supported by
various sectors.
Source from (Bernama): http://www.bernama.com/bernama/v7/bu/newsbusiness.php?id=961618
Published: July 07, 2013
Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah said the
country's economic growth was also dependent on consumption (spending)
and private sector investment alongside government spending.
"The primary basis for domestic growth is already there. We want a
banking sector of high quality, meaning liquidity in the sector, will
not be impacted.
"Investors from the corporate sector and entrepreneurs will be able to
obtain loans more easily. When we enhance the quality of spending by the
people and the banking sector, it will also contribute to the country's
growth," he told reporters here Sunday.
He had earlier officiated a programme on enhancing the use of libraries
by the people under the 1Malaysia Library, Kampung Datuk Ahmad Said
Tambahan 3, at Manjoi here.
Ahmad Husni said the new move by BNM, is expected to see a reduction in
loans, but it will not impact overall spending and the private sector,
as well as government spending which had its own overall basis.
"In the banking sector, while the loan policy is high, we see that in
the context of the Minimum Payment System, it is very low. We want to
move in the direction of higher affordability on the issue of homes," he
added.
He said if there was low affordability, there are some who will borrow
from institutions outside formal banking and this is not a good
practice, leading to problems, and the government wants to strengthen
the formal economic system as it is now.
Ahmad Husni said BNM's initiatives which are effective immediately, is
also capable of changing the spending culture to one that is more
positive.
He said it was worrying when BNM's study showed that as a result of
easily securing personal loans and a long repayment period, the
Malaysians involved were having a lower "take home pay".
"BNM hopes that personal loans will move in a more productive direction
as there were many individuals borrowing for non-important matters. So,
it is excessive spending that we want to avoid," he added.
Apart from high quality loans, BNM's initiative will also create
Malaysians with a higher income in their lives, Ahmad Husni said.
"For the long term, we see that from the aspect of the level of
salaries, and it is important we ensure that the targeted economic
growth is achieved.
"This means when the targeted growth moves towards that of a high
income nation with a high Gross National Income, it will enable income
distribution to workers in the private and public sectors, and enhance
that of the people," he added.
Ahmad Husni said the policy towards this was already available through
the Economic Transformation Programme and was moving towards an
achievable standard.
This is despite from this year until 2020 the global economic growth being very challenging in the face of a decline.
When asked if there would be any more new proposals to be tabled in the
Budget 2014 following BNM's announcement on the new initiatives, he
said what had been mooted was sufficient.
But he added that there would new initiatives to be undertaken such as that for the Bantuan Rakyat 1Malaysia (BR1M).
"We see no problems in enhancing the BR1M level. It is the basis for
the government to review the subsidy rationalisation policy.
The government subsidy is very large and is enjoyed by all the people without considering the income levels.
"We are studying how to rationalise the subsidy and transfer the
rationalisation to the target group through the BR1M," Ahmad Husni said.
-- BERNAMA
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