Umno Youth has challenged Finance Minister Tengku Zafrul Abdul Aziz’s statement that the government is unable to legally compel banks to allow a blanket loan moratorium.
In a statement today, it listed three laws that empowered Putrajaya to impose an “automatic” moratorium.
Criticising Zafrul’s “simplistic” explanation, Umno Youth chief Asyraf Wajdi Dusuki pointed to Section 72 of the Central Bank of Malaysia Act 2009 (Issues of Policy).
“This clearly gives power to the cabinet to overrule or cancel any decision made by Bank Negara Malaysia (BNM), where BNM as a policy enforcer must obey instructions from the minister in charge,” he said.
Asyraf said Section 6 (Regulatory objectives) and 7 (Powers and function of bank) of the Financial Services Act 2013 was also relevant.
“This also provides the Finance Minister clear powers to instruct BNM on policies related to finance and banking,” he said.
Furthermore, the Emergency (Essential Powers) Ordinance 2021 gave the executive “full powers” to make new laws plus overrule existing laws to achieve the objectives of the emergency, he added.
Why an emergency then?
Lawyer Mohamed Haniff Khatri Abdulla had said Zafrul was mistaken and that the emergency gave the government power to assume control over banks.
PKR Youth vice-chief S Thiban opined that the emergency would be proved a “failure” if Putrajaya did not use it to allow a blanket loan moratorium.
“What is the point of an emergency if the government can’t control the banks?
“Or is the government of the day controlled by banks?” he wondered in a separate statement.
GLCs own banks
Meanwhile, Asyraf, a former senator and deputy minister, pointed out that government-linked companies (GLCs) owned deciding shares of at least four commercial banks.
Tabung Haji, the Employees Provident Fund (EPF), Permodalan Modal Bhd (PNB), and the Retirement Fund Incorporated (Kwap) own an 83 percent stake in Bank Islam.
Khazanah Nasional owns a 30 percent stake in Bank Muamalat.
PNB, EPF, and KWAP own 62 percent of Maybank.
The trio also owns a 62.1 percent stake in CIMB Bank.
“Therefore, Umno Youth calls upon the government to make full use of its existing powers to instruct banks - that have recorded billions of ringgit in profits in the first quarter of 2021 alone - to offer an automatic moratorium to the rakyat sans additional charges or interest for three months.
“And not to limit this to just the B40 (bottom 40 percent of income earners) group,” he stressed.
Yesterday, Zafrul said Perikatan Nasional did not incorporate a blanket loan moratorium into its latest stimulus package because it did not “control or own” banks.
“You have to understand, the government does not control or own the banks, right?
“This is the discussion between BNM and the banks. We do not have any legal ability to force banks to do (what we want).
“Under the Pemerkasa Plus, we are providing an automatic loan moratorium to the bottom 40 group. If they apply, they can get it,” he had said.
The three-month loan moratorium option is presently open to borrowers from three categories: the B40 group, those who have lost their jobs, and SMEs that are barred from opening.
They can either choose that option or get a 50 percent discount on their loan repayments for six months. - Mkini
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