HSBC extends support to beleaguered garment sector
HSBC Bangladesh yesterday announced a set of measures to help its textile and garments clients tide over the economic fallout from the coronavirus pandemic.
The lender will provide special short-term loans of up to one year with principal moratorium for four months, which can be used for the purpose of supporting payroll bill and utility payment.
Although the Bangladesh Bank has recently asked banks to extend similar support to businesses, which are being battered from all side by COVID-19, the British lender is the first to formally announce measures of its own.
The bank will also allow three months' moratorium against the existing term loans enjoyed by businesses belonging to the textile and garments sector, according to a press release issued by HSBC Bangladesh.
During the moratorium period, clients will not be required to give any instalment and the lender will not seek any repayment amount from them as well.
HSBC will provide up to 90-day extension of import liability maturing in next three months where export shipments are delayed.
It will work to ease cash flow pressures faced by businesses and help customers tackle the market uncertainties, including disruptions to their supply chains.
To ease the pressure on Bangladeshi economy, clients will be allowed to enjoy trade relief in the form of waiver of letters-of-credit (LCs) commission and margin requirements for the import of medicine, medical equipment and accessories used to treat COVID-19.
Customers facing delivery disruptions owing to late shipment and presentation of documents will have amendment fees on LCs waived, said HSBC, one of the largest banks in the globe serving more than 40 million customers in 64 countries and territories of the world.
"We are going through challenging times in Bangladesh and are committed to continue our support to the local community to the best of our capabilities," said Francois de Maricourt, chief executive officer of HSBC Bangladesh.
HSBC empathise with its customers who have to deal with the turbulence caused by this unforeseeable outbreak and it is taking actions to help alleviate their financial burden, he said.
The lender recognises that many customers may have to run their banking in a digital norm to continue their business where conventional paper flow is not possible due to the unprecedented situation arriving from the virus outbreak.
Against the backdrop, the bank will provide support to customers to onboard onto HSBC's digital platforms 00 HSBCnet -- to enable the flow of trade to continue.
Although some clients are still using the paper-based banking, the platform is completely paperless. Relationship managers of HSBC Bangladesh will help its clients operate the digital platform.
Along with the textile and garments sector, the lender will actively evaluate and try to introduce specific initiatives to support its customers in other sectors as required.
"We are increasing our support to the business community to navigate this difficult journey together. The announcement is another testament of our commitment to the customers in the countrty," said Md Mahbub ur Rahman, the CEO designate of HSBC Bangladesh.