Banks must adjust loan rates within 7 days of OPR cut, says ABM
In an email to Business Times, ABM said the 0.25 per cent OPR cut announced on July 9, 2025, must be reflected in loan interest rates by July 18, 2025.
The clarification comes amid public concern over delays in housing loan instalment adjustments, triggered by a viral blog post in which customers shared their frustration after being told that their lower monthly repayments would only start on September 5 – almost two months after the OPR reduction.
One customer, who contacted their bank to request an updated instalment amount and outstanding loan balance in preparation for early settlement, was surprised that the revised monthly payment had not yet taken effect, despite the new interest rate already being reflected in the system.
ABM explained that while interest rate adjustments are made within the stipulated timeframe, changes to instalment amounts may vary across banks due to differences in internal systems, operational processes, and billing cycles.
"Such variation is not unusual and reflects operational differences between institutions. Nevertheless, the revised instalments must be implemented no later than 90 days from the OPR change.
"Rest assured that the loans with variable interest rates will already be subject to the revised interest rates within seven working days from the OPR change," ABM said.
ABM said that banks are also required to notify customers at least seven days before the new instalment takes effect. Borrowers are encouraged to contact their banks for precise information tailored to their individual loan accounts.
For borrowers planning to redeem their loans during this period, ABM advises requesting an updated redemption statement, which will reflect the new rate and the revised outstanding balance.
"Banks remain committed to passing on rate changes to customers fairly and accurately.
"We encourage borrowers to reach out directly to their banks for clarification and to ensure they receive timely, accurate information tailored to their loan account," it added.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
New Straits Times
an hour ago
- New Straits Times
RON95 price cut: One of government's best initiatives, says expert
KUALA LUMPUR: The government's decision to reduce RON95 fuel price to RM1.99 per litre is probably one of the government's best initiatives to date, said tax expert Datuk Harjit Singh Sidhu. He said the reduction in petrol price removes a common excuse used by businesses to justify price hikes. "I foresee prices of goods and services coming down as transportation costs decline. The next question now is whether businesses will pass these savings on to consumers," he told Business Times. Harjit also welcomed the decision to charge non-Malaysians the unsubsidised market price for petrol, noting that this would help stabilise government cash flow. On the toll freeze on 10 major highways and the government's RM500 million compensation to concessionaires, Harjit acknowledged the strain it could place on public finances but stressed the importance of prioritising the people's immediate needs. "Toll charges are part of the cost of doing business. Any increase would raise logistics and retail prices. "We can't get the best of everything . I believe the government is looking at what's important as of now," he said. He advised pausing new infrastructure developments temporarily to focus on safeguarding livelihoods of the B40 and M40 income groups. "This toll freeze should be seen as a proactive move in assisting those in needs in general. "To curb long-term concession planning, proper costing and town planning is required and government should consider more privatisation and reducing government participation. "But at the same time, it shoud consider enforcing price control to avoid profiteering and any form of indirect increase in the general business cost for business owners," he added.
New Straits Times
3 hours ago
- New Straits Times
Pause in toll rate increases a critical buffer for hauliers: AMH
KUALA LUMPUR: A pause in toll rate increases will be a critical buffer for Malaysia's freight forwarders against rising operational pressures, industry players said. The Association of Malaysian Hauliers (AMH) welcomed the government's decision to halt planned toll hikes on 10 major highways this year, describing it as a timely intervention for an industry already grappling with rising costs. Its executive secretary Mohamad Azuan Masud said the toll freeze gives hauliers some short-term relief and cost stability, as tolls are a major part of their operating expenses. "As an industry that moves over 90 per cent of Malaysia's containerised goods by road, hauliers have long operated under tight margins, further pressured by increasing costs for spare parts, maintenance, compliance and wages. "The freeze is a timely decision that allows transporters to plan operations more efficiently without unexpected toll adjustments mid-contract," he told Business Times. Prime Minister Datuk Seri Anwar Ibrahim today said the government had postponed scheduled toll hikes on 10 highways to maintain the current rates for the public. As a result, the government will bear costs exceeding RM500 million. The highways include rthe Senai-Desaru Expressway, East Coast Expressway Phase 2, South Klang Valley Expressway, Butterworth Outer Ring Road and KL-Putrajaya Expressway. Azuan, however, said hauliers remain cautious with regard to another key cost component: diesel fuel. He said while the government had so far maintained fuel subsidies for commercial vehicles, the association was concerned about the upcoming shift towards a more targeted and potentially stricter implementation. "While the intention to curb leakages is understandable, the administrative process for verifying eligibility and managing claims could become burdensome for transport companies already dealing with complex logistics and tight schedules," he added. Therefore, the association urged the government to ensure that any mechanism for diesel subsidy targeting be streamlined, efficient and designed with minimal disruption to operations. It also called for sufficient stakeholder engagement before implementation to avoid unintended consequences. Additionally, the association stressed the need for fair support for hauliers, who form the backbone of land logistics, to ensure that cost control efforts translate into supply chain stability. Azuan said the association sees the toll freeze as a positive first step, but emphasised that it should be part of a broader, long-term strategy to enhance the sustainability of Malaysia's logistics sector. "This includes targeted incentives, infrastructure upgrades and inclusive policymaking. AMH remains committed to supporting the government's efforts through constructive dialogue and continued collaboration," he added.
The Star
13 hours ago
- The Star
Deposit costs to buoy Affin Bank
HLIB Research said Affin's loan pipeline remains robust at about RM9bil. PETALING JAYA: Affin Bank Bhd 's net interest income (NIM) is expected to remain resilient in the lender's upcoming second quarter (2Q25) earnings announcement, analysts say. Affin's NIM is expected to be underpinned by a solid loan base, said Hong Leong Investment Bank Research (HLIB Research). Despite some churn, the research house said Affin's loan pipeline remains robust at about RM9bil. 'Concurrently, 2Q25 NIM is expected to remain stable sequentially as proactive cost of funds optimisation efforts are set to largely offset any asset yield pressure from loan competition. 'Meanwhile, with the yields for 10-year Malaysian Government Securities currently still below 3.5%, there's significant room for Affin to capitalise on favourable trading opportunities,' HLIB Research said in a report. HLIB Research also expects the bank's gross credit cost to remain stable, supported by steady asset quality. Additionally, improved recovery momentum should help keep net credit costs within single digits for this financial year (FY25). 'We maintain our 'buy' rating on Affin, with an unchanged target price of RM3, implying a 0.60 time FY26 price-to-book value. 'We believe the bank is on the cusp of a notable enhancement in profitability, primarily driven by a fundamental shift in its funding mix, alongside a robust loan pipeline and enhanced operational efficiencies, which are set to drive return on equity.' The research house said while sector-wide asset yields have gradually declined, Affin's primary challenge and significant opportunity lie in managing its cost of deposits. It said liquidity following the cut in the Statutory Reserve Requirement could partially offset the impact of the recent 25 basis points (bps) cut in the overnight policy rate (OPR) . Deposit competition is easing and Affin is expected to benefit from an increase in low-cost current account and savings account deposits, driven by inflows from Sarawak, the bank's major shareholder. This is estimated at around RM130mil per month by 3Q25. According to HLIB Research, this allows the bank to shift from costly promotional rates for deposits to lower-cost payroll-based accounts, helping build a more stable and cheaper funding base. 'Interestingly, our tracker on retail fixed deposit (FD) promotional rates showed that after the 25bps OPR cut on July 9, Affin aggressively slashed its FD promotional rates by between 35bps and 50bps, whereas peers only cut up to 25bps. 'This steeper reduction suggests a deliberate strategy, likely driven by the anticipation of cheaper funding sources coming online, which enables Affin to reduce reliance on higher-cost deposits,' the research house said.
