Big Banks to the rescue
(7 April 2009 – Australia) Australia’s Big Four banks, with the Federal Government, have set up a plan to come to the rescue of lenders facing financial hardship.
ANZ, CBA, NAB and Westpac, working with the Federal Government and the ABA, have adopted a set of expanded principles to assist customers with loans who are experiencing temporary financial difficulty.
David Bell, chief executive of the ABA, said that in a weakening economic environment, it is important that customers understand that banks will try to help if a borrower’s income is interrupted temporarily, including loss of job.
On an individual basis, the bank might consider adjusting the terms of the mortgage contract by providing a repayment holiday and interest will be capitalised, or making interest-only repayments for a short period of time, Bell added.
Prime Minister, Kevin Rudd, said that the Government's purpose in its negotiations with the banks was to ask the banks to provide maximum flexibility for borrowers suffering temporary hardship through forced unemployment.
The ABA outlined the expanded principles that the Big Four will follow; including temporary assistance options; indentifying borrowers in hardship; staff training; streamlined processes; information of hardship processes; timely assistance; financial information and counselling services; and needs based assistance.
Westpac CEO Gail Kelly said that the Westpac and St George brands are extending their financial hardship program to small and medium business lending.
David Bell, chief executive of the ABA, said that in a weakening economic environment, it is important that customers understand that banks will try to help if a borrower’s income is interrupted temporarily, including loss of job.
On an individual basis, the bank might consider adjusting the terms of the mortgage contract by providing a repayment holiday and interest will be capitalised, or making interest-only repayments for a short period of time, Bell added.
Prime Minister, Kevin Rudd, said that the Government's purpose in its negotiations with the banks was to ask the banks to provide maximum flexibility for borrowers suffering temporary hardship through forced unemployment.
The ABA outlined the expanded principles that the Big Four will follow; including temporary assistance options; indentifying borrowers in hardship; staff training; streamlined processes; information of hardship processes; timely assistance; financial information and counselling services; and needs based assistance.
Westpac CEO Gail Kelly said that the Westpac and St George brands are extending their financial hardship program to small and medium business lending.
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