The SBV requests banks to consider reducing interest rates, keeping the affected borrowers in their current debt group
In the newly issued guidance document, the State Bank of Vietnam requests credit institutions to consider restructuring the repayment period, reducing interest rates, temporarily keeping those borrowers affected by the Covid-19 outbreak in their current debt group.
The State Bank of Vietnam has just issued a guidance document on the implementation of measures in providing support for those customers that have been affected by Covid-19 outbreak.
Accordingly, in implementation of the above guidance of the Government, the State Bank of Vietnam requests credit institutions to consider rescheduling repayment of loans, exemption and reduction of interest rates, and temporarily keeping the debt group for those customers affected by Covid-19 outbreak and those who have outstanding principal and/or interest interest due between January 23, 2020 and March 31, 2020, until the State Bank of Vietnam promulgates a Circular guiding this issue.
At the same time, the State Bank of Vietnam also requests credit institutions to consider providing new loans to customers as prescribed in order to stabilize production and business.
The content of the guidance document stated that the rescheduling, exempting and reducing loan interests, keeping debt groups for customers that have been affected must meet the following requirements.
The debt repayment rescheduling is performed at the request of the customer and based on the assessment of the credit institution on the extent of damage, impact, financial capacity and repayment capability of the customer following the restructuring of the repayment term.
Credit institutions to guide the implementation of this content in a consistent manner throughout the system, in which specifies: criteria for determining debts affected by Covid-19 outbreak; contents of inspection, control and supervision of debts with rescheduled terms of repayment, exemption and reduction of interest rates, debt group unchanged for consistent and system-wide implementation.
Also, credit institutions should be proactive, self-determined and responsible for the rescheduling of loan repayment, exemption and reduction of loan interests, temporarily keeping the debt group for customers affected by Covid-19 as instructed, ensuring strict, safe and right subjects; prevent the misuse of mechanisms to falsely reflect the credit quality.
Credit institutions to report to the State Bank (via Bank Inspection and Supervision agency, Department of Credit for Economic Sectors) of results of loan repayment restructuring, exemption and reduction of interest rates, temporary keeping the debt group, making new loans for customers affected by Covid-19 on March 15, 2020 and March 31, 2020.
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