A COVID-19 credit support package worth VND 285,000 billion will be made available soon
Mr. Nguyen Quoc Hung, Head of Department of Credit for Economic Sectors, said that the State Bank of Vietnam is developing a credit package to support those businesses affected by COVID-19 with a total value of VND 285,000 billion.
So far, there have been banks developing credit packages of VND 100,000 billion, VND 20,000 billion and VND 5,000 billion, etc. Accordingly, more than 10 banks have participated in this program, including the Big 4 State-owned commercial banks and 6 joint stock banks. Lending interest rates will depend on the specific situation of each business and the affected unit without fixed interest rate applying. In particular, credit institutions will reduce interest rates by 0.5-1% compared to interest rates on the market.
Mr. Nguyen Quoc Hung affirmed that this support completely comes from banks and does not use the budget. Besides, the State Bank of Vietnam is drafting a Circular regulating the debt rescheduling; loan interest exemption and reduction; keeping the debt group for those cutomers affected by the COVID-19.
Subjects of application of the Circular are: credit institutions (excluding Vietnam Bank for Social Policies), foreign bank branches; organizations and individuals involved in debt rescheduling; loan interest exemption and reduction; keeping the debt group for cutomers affected by the COVID-19.
"The reason why the Draft Circular excludes policy bank from the subjects of application is because the policy bank operates on a non-profit basis and operates under a separate document system compared to other credit institutions. Accordingly, the amount of bad debts of the Policy Bank is not included in the total amount of bad debts of the whole system of credit institutions and foreign bank branches, "Mr. Hung said.
Also according to the Draft Circular, credit institutions and foreign bank branches are allowed to make debt restructuring, loan interest exemption and reduction for debts arising from credit activities in one of the specific cases: Debts which have not been converted to overdue debts and customers are assessed as not being able to fully repay the principal and/or interest under the signed contract due to adverse effects of COVID-19 outbreak, including debts covered by the Decree No. 55/2015/ND-CP dated June 9, 2015 of the Government on credit policies for agricultural and rural development (amended and supplemented).
Credit institutions and foreign bank branches can keep customers in their debt groups as classified according to the State Bank's regulations as of the latest time before January 23, 2020 for the outstanding loans of the above-mentioned debts whose repayment term of principal and/or interest is between January 23, 2020 and immediately 90 days after the competent State agency announces the end of the COVID-19 outbreak, including loans that have been provided with debt restructuring, loan interest exemption and reduction during the period from January 23, 2020 to the effective date of this Circular and loans that have been converted the loan group in accordance with the regulations of the State Bank, etc.
- State Bank of Vietnam cut down regulations on business activities
- The State Bank will consider reducing policy interest rates further
- Governor: The banking system is much better so it can support the economy
- Credit resumed positive growth again
- Remittances decline due to Covid-19
- Banks in Ho Chi Minh City restructured over VND 63,000 billion worth of debt affected by Covid-19
- Inward remittances affected by COVID-19
- BVSC: Interest rate levels may continue to decline
- The State Bank of Vietnam directs the establishment of a hotline to assist customers affected by COVID-19
- Creating a favorable environment for digital technology development in credit institutions