SINGAPORE (May 5): United Overseas Bank (UOB) has approved $4 billion in loans under the Temporary Bridging Loan Programme (TBLP).

The programme, which started in March 2020, and is valid till March 2021, helps provide access to businesses with working capital. These businesses may borrow up to $5 million capped at a 5% p.a. interest rate from Participating Financial Institutions (PFIs).

The government will be sharing 90% of the risk on such loans for applications submitted from April 8 to March 31, 2021.

The loans were extended to UOB’s mid-sized clients in sectors that have suffered damaging impact from Covid-19. These sectors include construction, consumer staples such as household goods, food and beverages, and hygiene products, hospitality, and retail.

The application process has been digitised for clients to receive their funds in about a week.

UOB has also made use of the Monetary Authority of Singapore (MAS)’s SGD Facility for Enterprise Loans to help its clients access funding at lower interest rates. The bank will be passing on the funding cost savings to its clients.

UOB’s head of group commercial banking Eric Tham says, “As the COVID-19 pandemic continues to affect businesses’ day-to-day operations, many mid-sized firms are finding themselves at a critical juncture. These firms tend to have hundreds of employees and high overhead fixed costs, making it imperative for them to access additional liquidity quickly”.

“Since the start of the COVID-19 pandemic, we have been helping SMEs overcome the shock to their business. We have helped our clients overcome their immediate liquidity challenges by providing loan moratoria and allowing them to repay loan interest only. Through our close collaboration with the MAS and ESG, we have helped clients access funding under the government-assisted schemes quickly and at much lower interest rates than before the pandemic,” he adds.

As at 2.15pm, shares in UOB are trading at 16 cents higher, or 0.8% up, at $19.97.