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Central Bank to Amend Rates on Personal Loans

ABU DHABI — The Central Bank of UAE reviewed yesterday a proposal for amending interest rates and charges on personal loans and decided to seek opinions of banks on the system.

A Senior Executive Director of the Banking Supervision and Examination Department presented a proposal to the board of the central bank regarding provisions for loans, interest in suspense and investment provisions. The board reviewed the proposal for amending interest rates and charges on personal loans in addition to charges and commissions charged against services rendered to individual customers, and decided to seek banks opinions on the system.

Dr Syed Qaiser Anis, a chartered accountant, said it seems that a new ceiling on fees and charges is in the offing and banks would not be allowed to overcharge from their customers. He said that the central bank also wants to have a relook on its guidelines on tackling the bad debts, in the wake of current financial crisis when many people are unable to pay their mortgages and personal loans.

“Seeking the views of the banks should also ensure there will be a balanced and equitable outcome to any regulations proposed regarding the provisions for loans,” said Eric Milne, a partner on Banking & Finance at law firm Simmons & Simmons. 
 — haseebhaider@khaleejtimes.com-

With inputs from Wam