The Hong Kong Monetary Authority - Pre-approved Principal Payment Holiday Scheme

The Hong Kong Monetary Authority (“HKMA”), together with the Banking Sector SME Lending Coordination Mechanism has launched a Pre-approved Principal Payment Holiday Scheme (the “Scheme”) for eligible corporate customers. The launch date of the Scheme was 01 May 2020 (the “Launch Date”), as per the HKMA press release dated 17 April 2020. The key features of the Scheme are as follows:

  • Corporate borrowers that have an annual sales turnover of HK$800 million or less based on their latest financials, that have no outstanding loan payments overdue for more than 30 days, and are not in the process of ceasing operations or declaring bankruptcy or liquidation, are eligible for the Scheme.
  • All principal payments of bilateral loans falling due within 6 months from the Launch Date for eligible borrowers will be pre-approved for deferment. Principal payments of bilateral loans (including revolving facilities) will generally be deferred by 6 months, whereas trade facilities (except for facilities which are self-liquidating in nature) will be deferred by 3 months.
  • The Scheme does not cover syndicated loans or loans used for financing purchases of shares or other financial assets.

On 05 August 2020, the HKMA together with the Banking Sector SME Lending Coordination Mechanism announced an extension of the 90-day repayment deferment for trade facilities under the Scheme. This deferment covers,

  • Trade loans both currently subject to the Scheme as well as those drawn between 01 May 2020 to 31 July 2020 with no outstanding payments overdue for more than 30 days as on 1 August 2020;
  • And self-liquidating facilities. For such facilities, the loan will be settled when the underlying payment has been received by the customer.

 

The Scheme was further extended by HKMA together with Banking Sector SME Lending Coordination Mechanism on 02 September 2020 for another six months till April 2021. All loan principal payments of eligible customers falling due between November 2020 and April 2021 were deferred by six months except for repayments of trade loans, which was deferred by 90 days. The deferment applied whether or not a loan had been on a principal payment holiday.

 

On 29 January 2021, the HKMA together with the Banking Sector SME Lending Coordination Mechanism announced a further 90-day repayment deferment for trade facilities under the Scheme. The repayments of trade facilities falling due between 1 February and 30 April 2021 as well as those drawn down from November 2020 to 31 January 2021 were deferred by another 90 days.

 

On 04 March 2021, the HKMA together with the Banking Sector SME Lending Coordination Mechanism announced that all principal payments of loans falling due between 01 May and 31 October 2021 by eligible corporate customers will be deferred by another six months except for repayments of trade loans, which will be deferred by 90 days.

 

On 15 July 2021, the HKMA together with the Banking Sector SME Lending Coordination Mechanism announced a 90-day repayment deferment for trade facilities under the Scheme until the end of October 2021. The deferment covers trade loans both currently subject to the Scheme as well as those drawn between 01 May 2021 and 31 July 2021 by eligible customers with no outstanding payments overdue for more than 30 days as on 01 August 2021.

 

On 21 September 2021, the HKMA together with the Banking Sector SME Lending Coordination Mechanism announced that the Scheme will be extended for another six months to end-April 2022. All principal payments of loans falling due between 01 November 2021 and 30 April 2022 by eligible corporate customers will be deferred by six months except for repayments of trade loans, which will be deferred by 90 days.

 

On 11 January 2022, the HKMA together with the Banking Sector SME Lending Coordination Mechanism announced a further 90-day repayment deferment for trade facilities under the Scheme until the end of April 2022. The 90-day extension will cover existing trade loans under the Scheme which will fall due between 1 February and 30 April 2022, as well as new trade loans drawn between 1 November 2021 and 31 January 2022 by eligible customers.

 

All other terms of the Scheme as stated in the HKMA’s circular dated 17 April 2020, 05 August 2020, 02 September 2020, 29 January 2021, 04 March 2021, 15 July 2021 and 21 September 2021 would continue to apply.

 

For questions regarding the scheme, please contact us at:

Email: hkcorporatecare@icicibank.com (Please mention subject as “Pre-approved Principal Payment Holiday Scheme – Name of the Company”)

Phone: +852- 22342541/44/84 (service hour: Mon – Fri 9am – 6pm)