Amanah Saham Bumiputera(ASB) is a unit trust fund for Malaysian Bumiputeras, launched by Amanah Saham Nasional Berhad (ASNB) in 1990. This trust fund is attractive to many because it generates impressive and competitive returns in the long run.
Many Malaysians looking at buying into ASB may not necessarily have the amount of money that could generate the desired returns. Here’s where banks could assist you with an ASB loan.
What is an ASB Loan?
Similar to an ASB fund, ASB loans are eligible only to Bumiputeras. After applying for the loan, the bank will make you open up an ASB account. When the loan application has been approved, the lending bank will credit the amount you applied for directly into your ASB account.
From then onwards, you’ll be repaying off the loans on a month-by-month basis. Additionally, some management and documentation fees might be charged by banks when applying for an ASB loan.
The loans are basic term loans and are calculated using the reducing balance method. Most ASB loans use floating interest rates based on the Base Lending Rate (BLR). According to this, the rates might change from time to time.
As long as it is not within the lock-in period, you won’t face any penalties on early settlements. You would only need to settle off the remaining loan balance. However, if a borrower settles within the lock-in period, an exit penalty will be imposed.
Since the ASB loans are basic term loans, extra payments in monthly instalments do not lower the interest payable.
Should you apply for one?
The immediate answer is yes. Historically, the returns on ASB funds has never dipped below 8.55% p.a since its inception. Using a loan instead of buying in with cash is a better way of investing since it ensures much more stable returns in the long term. Not to mention, you get to improve your credit rating while you enjoy the growing dividends.
If you’re a Bumiputera and you’re interested in getting an ASB loan, RHB Bank is one of the three banks in Malaysia that offers it.
Check out https://www.rhbgroup.com/products-and-services/personal/loans/asb-financing now to learn more!