ADCB offers to defer loans and waive interest for customers hit by coronavirus

The move will support 1.2 million retail customers of ADCB and over 50,000 SME customers of Al Hilal Bank

ADCB Group now serves one million customers through 72 branches and 450 ATMs following completion of its three-way merger with Union National Bank and Al Hilal Bank. Chris Whiteoak / The National

Abu Dhabi Commercial Bank is offering to defer loan payments and waive interest for up to six months for customers impacted by the coronavirus outbreak.

The lender said the move, effective from April 2, will support 1.2 million retail customers of both ADCB and Al Hilal bank, as well as more than 50,000 SMEs who bank with ADCB. Relief measures will be subject to an "appropriate level of scrutiny" from the bank.

ADCB said it would offer payment deferral and waive interest charges on loans for three months to those who are placed on unpaid leave as a result of the outbreak.

A payment deferral will also be available on request for customers who have personal loans, car loans or mortgages, with no extra charges incurred.

Other measures adopted include a 5 per cent increase in the loan-to-value ratio for first-time homebuyers, a full refund of processing fees on foreign currency credit cards, reduction of 50 per cent in late payment charges on credit cards, interest-free instalment plans for school fee payments and a refund of charges on cash withdrawal from ATMs.

These measures would also be applicable to retail customers of Al Hilal Bank, which merged with ADCB and Union National Bank last year.

ADCB revealed a number of measures for its SME customers as well. The lender said it would defer a month's loan instalment on all business and equipment loans. It will also waive the interest due on all equipment and business loans by 1 per cent and 3 per cent, respectively.

The Abu Dhabi bank also said it would reschedule working capital facilities on a case-by-case basis to help businesses deal with cash flow disruptions. ADCB will reduce minimum balance payments for all SME accounts to Dh10,000 per month.

Mubadala group chief executive Khaldoon Al Mubarak was voted in as the bank's new chairman and Hussain Al Nowais as vice-chairman at a board meeting on Wednesday. Earlier in the day, Mr Al Mubarak, Ahmed Saeed Al Calily and Mohamed Ali Al Dhaheri were voted onto the board by shareholders at the lender's annual general meeting. Former chairman Eissa Al Suwaidi, vice-chairman Mohamed Al Hamli and Mohamed Al Mehairi stepped down from the board.

Mr Al Mubarak thanked the three departing directors "for their enormous contributions to ADCB’s success over the years".

"Eissa Al Suwaidi ...  steered the bank through a number of challenges, including the 2008 global financial crisis. He was instrumental in the bank’s growth for over a decade, and guided ADCB through one of the region's most significant mergers," Mr Al Mubarak said.

ADCB's support measures come as the UAE Central Bank launched a Dh100 billion stimulus package via the local banking sector to support businesses from the economic fallout of containing the coronavirus.

The Targeted Economic Support Scheme, announced on Saturday, provides funding to banks and allows them to delay principal and interest payments for up to six months on loans to all private sector and retail borrowers affected by the coronavirus.