The cabinet on Thursday approved a bill suspending repayment of loans for nine months and a €2bn stimulus plan in a bid to boost liquidity in the economy amid the ongoing crisis caused by the coronavirus epidemic.

“The entire government policy … aims at preserving jobs and avoiding bankruptcies,” Finance Minister Constantinos Petrides said during a news conference with Central Bank Governor Constantinos Herodotou.

Petrides said there will be a cost to banks, but they were not expected to have viability problems.

The first scheme approved by the cabinet concerns a suspension of loan repayment until December 31 while the second involved state guarantees worth €2bn to banks for low-interest loans.

The repayment suspension covers businesses, self-employed persons, and individuals who had been consistent with their dues.

Petrides said lenders were asked to act as channels without making a profit.

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