BANKS can help ease the impact of the US-China trade war by lending more and allowing small and medium enterprises (SMEs) to restructure their loans, the finance minister said today.

This would result in a “win-win situation” for businesses as well as for banks and create a positive outlook for the economy, said Lim Guan Eng.

“(When) we are impacted by the trade friction between China and the US, we hope banks can play their part and do their bit for the economy by allowing more lending.

“Not just to first-time house buyers but also to SMEs, for example, by restructuring and rescheduling some of their loans. Businesses may not be in trouble but asking them to pay at the same rate while they face challenges of the trade war, it doesn’t help them. 

“So, if you can lessen their costs by allowing some restructuring and rescheduling, they will feel they have more money because the debt curve is lengthened,” Lim told the press after launching the Securities Commission’s roundtable on financial technology (Fintech).

China has responded to its trade conflict with the US by making more cash available to “ease the impact of the external event” domestically, Lim said.

“We’ve expressed this to Bank Negara, we hope that banks and financial institutions (will follow).” – May 17, 2019.