PUTRAJAYA: The Finance Ministry is calling on banks to give greater access to financing for first-time house buyers and small and medium enterprises (SMEs) in order to grease economic growth.
Its minister Lim Guan Eng said the call was made based on positive outlook, including the fact that the financial health of Malaysian households was slowly recovering, with the household debt ratio to gross domestic product (GDP) having fallen to 83 per cent in 2018 from 83.8 per cent in 2017.
According to statistics from Bank Negara Malaysia (BNM), Lim said the level of household financial assets was 2.1 times household debt.
Nevertheless, the government recognised that lower income households were vulnerable to shocks, and would need help to raise their financial strength.
On the sudden spike of cement price, he said the government has been keeping a close watch on the matter and the Domestic Trade and Consumer Affairs Ministry had issued notices under the Price Control and Anti-Profiteering Act to 19 cement producers nationwide to explain the causes of the hikes.
The minister said the decision of the Monetary Policy Committee (MPC) of BNM on May 7 to cut its Overnight Policy Rate by 25 points to three per cent from 3.25 per cent had lowered the cost of borrowing.
The reduction had been transmitted fully by the banks to consumers, he said.
Lim said the government had also requested BNM to remind all banks that business borrowers who were not facing loan defaults, but wish to improve their cashflow by restructuring and rescheduling (R&R) their loans for a longer tenure, should not have such R&R loans classified as non-performing loans.