Bank announces Christchurch rebuild package

ASB has unveiled a $250 million package aimed at stimulating the Christchurch economy. Photo / Sarah Ivey

ASB has announced a $250 million package for earthquake devastated Christchurch, offering interest free and discounted loans, aimed at kick-starting the rebuilding of the city.

The package was aimed at stimulating the Christchurch economy, local businesses and community groups and was part of the largest disaster recovery and rebuild programme to be supported by the bank in its 164 year history, ASB chief executive Barbara Chapman said.

A new business rebuild fund would provide additional cashflow relief of up to $100 million for its existing small and medium businesses.

The fund would allow Christchurch businesses to switch existing borrowing with the bank into a one-year interest-free loan followed by two years with a one per cent discount on current interest rate.

A $100 million new business support fund would be available to existing customers and new businesses and would also provide a one-year interest free loan and two years at a one per cent discount.

Principal payments would not be required for the first 12 months under both funds.

Home loan customers would be offered a six-month repayment holiday and a one-year interest discount of one per cent on the variable rate or 0.5 per cent on the fixed rate.

Ms Chapman said the bank wanted to take some of the immediate financial pressure off its customers so they could focus on their immediate family and property priorities.

The bank also said $1 million would be distributed among registered not-for-profit community groups through a community grants programme.

Hundreds of local community and volunteer groups that support the Christchurch people had been affected, she said.

Prime Minister John Key described ASB's stimulus package as "generous and far-sighted".

"This is a multi-million dollar vote of confidence in Canterbury and I applaud ASB for their initiative," he said.

- NZPA