REFILE-Absa Kenya has restructured 4.25% of the loans to mitigate the effects of the coronavirus

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NAIROBI, April 14 (Reuters) – Absa Kenya has restructured loans totaling 8.3 billion shillings ($ 78.41 million), equivalent to about 4.25% of its net loans late last year, to cushion customers who of the coronavirus crisis, it said on Tuesday.

The lender, one of the East African nation’s largest by assets, is the first to disclose the impact the health crisis has had on its loan book after the central bank eased rules last month.

“We are working with our customers to help them get through these extraordinary times,” said Jeremy Awori, CEO of the lender, which is part of the South African Absa Group.

The relief, set on a case-by-case basis, applies to personal loans, mortgages, asset finance, credit cards and business loans, the bank said. There are no additional restructuring costs for borrowers, she added.

Absa did not comment on the potential impact of the loan restructuring on earnings this year. The pre-tax profit last year was ATS 10.75 billion.

Kenya has 208 confirmed cases of the virus-caused COVID-19 disease. Its economy, which relies on agriculture, tourism and cash sent home by its citizens abroad, is already suffering from job losses due to the crisis.

The government has halved its forecast economic growth for this year from originally 6% to 3%.

In addition to lending relief to troubled borrowers, the central bank has also cut lending rates and the amount of cash commercial banks have to hold.

In addition, the authorities have cut VAT by two percentage points to 14% and proposed the abolition of income tax for the low-wage earner.

$ 1 = 105,8500 Kenyan Shillings reporting by Duncan Miriri; Editing by Kirsten Donovan

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