At a meeting between the prime minister and leaders of ministries and the business community, deputy Governor of the State Bank of Vietnam (SBV) Dao Minh Tu said the profit of all State-owned banks this year must be reduced to a minimum of 40 percent to contribute to reducing interest rates to support businesses. “For example, Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) last year saw a profit of 22 trillion dong. This year it has to reduce by 30-40 percent of the interest, which contributes about eight trillion dong to lower interest rates”, said the deputy Governor.
Previously, the prime minister instructed SBV to continue requiring commercial banks to share difficulties with businesses, through expanding the monetary policy package from 185 trillion dong to 300 trillion dong.
Recently, commercial banks have implemented many measures under SBV’s instructions to support businesses, households and individuals affected by the Covid-19, including debt rescheduling and interest rate reduction of 2-2.5%.
Earlier, according to the Governor’s report at the government’s online conference, the total credit package that the banking sector supported businesses and individuals was more than 300 trillion dong. In particular, credit institutions (CIs) initially restructured the repayment period, keeping the debt group for over 52,000 customers with an amount of nearly 18 trillion dong, exempting and reducing interest rates for nearly 6,500 customers with outstanding loans nearly 126 trillion dong and new loan of 65.208 trillion dong with 354,286 customers.
For Vietcombank, Chair Nghiem Xuan Thanh said the bank would have a credit package of 30 trillion dong with lending interest rates falling by 2-2.5 percent compared to the current level. Enterprises producing essential goods will be reduced by 2.5 percent a year and enjoy interest rates of only 4.5-5 percent per year. The bank also continued to extend the policy of reducing interest rates by 1-1.5 percent for existing loans (from April 30 to September 30). Vietcombank’s profit is estimated to decrease by 300 billion dong due to this policy.
Vietnam Bank for Agriculture and Rural Development (Agribank) spent 100 trillion dong on preferential loans to customers affected by the epidemic, to restore, stabilise and develop production and business. The programme applies to loans disbursed from April 1 until three months after the prime minister announces the end of the Covid-19 epidemic or until the credit package is fully disbursed. Lending interest rate is one percent lower (for VND) and 0.5 percent lower (for foreign currencies) than the rates for same credit facilities.
Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank) also announced a credit programme of 60 trillion dong with loan interest rates down two percent per year. Previously, the bank reduced the interest rates by 0.5 percent 1.5 percent depending on customers and the purpose of borrowing for nearly 3,000 customers with a disbursement of about 60 trillion dong, during the Covid-19 period. The bank has restructured and maintained the debt group of about 350 customers with outstanding loans of about 18 trillion dong, accounting for two percent of outstanding loans.
Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) decided a credit package of 20 trillion dong to meet the demand of buying houses, cars or production and business of individual customers, with an interest rate of 7.3 percent per year. Previously, at the end of March, the bank also launched a credit package of 30 trillion dong applied from March 31 to July 31 or when the package ends to support individual customers to continue production and business in difficult times. Another package of BIDV is seven trillion dong deployed from March 19 and ending before March 31. BIDV said that from the beginning of the year, more than 17 trillion dong had been disbursed with preferential interest rates from 6.5 percent per year for individual customers. This year, BIDV planned a pre-tax profit of 12.5 trillion dong, an increase of 15 percent over the previous year, in the condition that Covid-19 epidemic would be soon under control.
