Direct
At the regular online government meeting in March 2020, Governor of the State Bank of Vietnam, Le Minh Hung, stated that on March 31st, the State Bank of Vietnam held a meeting with 20 credit institutions (accounting for approximately 75% of the total outstanding loans to the economy), and all credit institutions unanimously agreed to reduce lending interest rates by at least 2% compared to the period before the pandemic.
Over the past two days, a number of banks have officially announced credit packages and interest rate reductions, with some banks reducing rates by up to 4,5% per year, and others lowering interest rates on existing loans.
Details
VIB is a pioneering bank in announcing interest rate reductions for existing loans, starting from April 1, 2020. Specifically, VIB continues to expand its interest rate support package with reductions ranging from 0,5% to 2,0% for 6 months for all existing customers, including large enterprises, small and medium-sized enterprises, and micro-enterprises in all sectors.
The support package applies to all medium- and long-term loans in VND (excluding bonds) with existing interest rates of 9,5% or higher. Initial estimates suggest that approximately 9.500 customers with outstanding loans totaling around VND 10.000 trillion will immediately benefit from this support, as part of VIB's efforts to help customers overcome difficulties caused by the Covid-19 pandemic.
HDBank also significantly reduced lending interest rates for all customers, without requiring proof of hardship due to the Covid-19 pandemic, starting from March 31st. The preferential loan interest rate reduction package ranges from 2-4,5% for individual customers and micro-enterprises affected by the Covid-19 pandemic nationwide.
The bank also designed various credit packages for different customer groups during the Covid-19 pandemic, such as 10.000 trillion VND to support price stabilization of consumer goods and essential items, flexible interest rate reductions starting from only 6,5%/year for businesses supplying goods and services to supermarket chains for the people; 5.000 trillion VND in preferential financing for SME customers; 3.000 trillion VND to finance businesses operating in the field of supplying pharmaceuticals, medical equipment and supplies to meet the needs of combating the epidemic; and a 1.000 trillion VND package for the rural agricultural chain to ensure rice production and supply for the whole country while supporting businesses and households facing difficulties due to drought and salinity intrusion in the Mekong Delta…
Vietcombank, BIDV, VietinBank, and Agribank have committed to significantly reducing lending interest rates by up to 2,5% per year.
At a meeting on March 31, the leaders of the four state-owned commercial banks, Vietcombank, BIDV, VietinBank, and Agribank, committed to significantly reducing lending interest rates by up to 2,5% per year.
Mr. Nghiem Xuan Thanh, Chairman of Vietcombank, stated that the bank has implemented a policy of reducing VND interest rates for all businesses and individuals affected by the pandemic. The total outstanding loan balance for sectors/fields affected by COVID-19, supported by Vietcombank with interest rates 0,5-1,5% lower than the general interest rate level, has now reached over VND 112.700 billion. In the near future, the bank will offer a VND 30.000 billion credit package with lending interest rates reduced by 2-2,5% compared to the current level. Businesses producing essential goods will receive a reduction of up to 2,5% per year, enjoying interest rates of only 4,5-5% per year.
In addition, the bank will continue to extend its policy of reducing interest rates by 1-1,5% on existing loans (from April 30th to September 30th). Vietcombank's profits are estimated to decrease by VND 300 billion due to this policy.
At Agribank, the bank has allocated 100.000 billion VND for preferential loans to support customers affected by the Covid-19 pandemic in recovering, stabilizing, and developing their production and business activities. The program applies to loans disbursed from April 1, 2020, until three months after the Prime Minister announces the end of the Covid-19 pandemic, or until the entire 100.000 billion VND credit package is disbursed.
Customers eligible for the program will receive an interest rate that is 1% lower (for loans in Vietnamese Dong) and 0,5% lower (for loans in foreign currency) compared to the standard interest rate for similar loans.
Previously, Mr. Pham Hoang Duc – Chairman of Agribank – pledged to work with commercial banks to implement mechanisms and policies, including supporting a further 2% annual interest rate reduction for those directly affected by the current COVID-19 pandemic.
VietinBank announced a further 2% reduction in lending interest rates and launched a VND 60.000 billion credit program to support customers starting April 1, 2020. Specifically, VietinBank continues to implement its low-interest credit program worth 60 trillion VND, with lending interest rates reduced by up to 2% per year compared to previous credit programs (before the pandemic). VietinBank offers special incentives to businesses supplying essential goods to the public during the Covid-19 pandemic.
In addition, VietinBank continues to implement credit programs with no size limitations such as: Supporting corporate customers, Preferential fixed interest rates for loans, Preferential interest rate loans as a token of gratitude for retail customers, etc., with lending interest rates 1,2%-3% lower per year than usual.
BIDV has officially announced a reduction of up to 2% per year in lending interest rates for both secured and unsecured loans in 2020. Specifically, for existing loans, the bank will restructure debt, extend the repayment period for principal and interest, and reduce interest rates by up to 2% per year (for VND loans) for businesses in sectors affected by the Covid-19 pandemic. The specific reduction amount will depend on the sector and the extent to which the business is affected by Covid-19.
The bank also reduced interest rates by up to 1% per year (for VND loans) for individual customers with unsecured consumer loans repaid through salary deductions due to the impact of the Covid-19 pandemic on their income. Specifically, for unemployed workers receiving the 1,8 million VND unemployment benefit as directed by the Government, BIDV will reduce interest rates by 2% and grant a grace period for principal and interest payments for these customers during the pandemic.
For new loan needs: BIDV offers credit packages to support businesses affected by the Covid-19 pandemic that need new loans, with interest rates reduced by 2% compared to the interest rates for similar loans on December 31, 2019.
Kienlongbank has decided to reduce the interest rate on in-term loans by 3% per year compared to the current rate applied according to the signed credit agreement for both individual and corporate customers. From April 1st to June 30th, 2020. For customers in the Mekong Delta region (prioritizing the 5 provinces that have declared a state of emergency: Kien Giang, Ben Tre, Ca Mau, Tien Giang, and Long An), to provide timely and urgent support to customers affected by drought and saltwater intrusion.
The bank stated that this program aims to supplement capital for agricultural production (raising, planting, and caring for) rice, fruit trees, vegetables, and aquaculture in 5 provinces affected by drought and saltwater intrusion. During this period, Kienlongbank also supports customers by waiving penalties for overdue interest and late payment interest. The maximum period for interest waiver/reduction is 3 months and does not exceed June 30, 2020.
VPBank launches its second special support package, reducing interest rates by up to 2% for businesses facing difficulties during the pandemic. Specifically, for secured loans, the maximum interest rate reduction is 1,5% per year for VND loans and 1% per year for USD loans. For unsecured loans, VPBank applies a maximum interest rate reduction of 2% per year for VND loans and 1% per year for USD loans.
Businesses eligible for these incentives must meet several requirements, including: operating in the tourism, restaurant, hotel, or transportation sectors; having exports to China, the US, and Europe accounting for at least 50% of their revenue in 2019; having at least 50% of their raw materials sourced from China, the US, and Europe; and experiencing difficulties in debt repayment due to the impact of the Covid-19 pandemic, as assessed by the business entity.
In addition, businesses must meet several other conditions set by VPBank, such as having a good credit rating over several consecutive periods; and a stable and transparent financial situation before the pandemic, as demonstrated in audited reports.
TPBank has launched additional preferential interest rate programs for new loan disbursements, totaling up to VND 12.000 billion. Specifically, TPBank offers packages of VND 5.000 billion for small and medium-sized enterprises (SMEs), VND 4.000 billion for large enterprises, and VND 3.000 billion for individual customers, with preferential interest rates reduced by 1,5-2,5% compared to current rates.
In addition to restructuring debt and extending principal and interest payments for customers as per regulations, TPBank is also reducing interest rates by 0,5% - 1% for existing customers severely affected by the pandemic, with the total outstanding debt eligible for consideration reaching up to VND 30.000 billion.
ACB has just launched an additional preferential loan package of VND 10.000 billion to further support customers directly affected by the Covid-19 pandemic. This is the second phase of the VND 35.000 billion preferential loan package that the bank has been implementing since the beginning of February to help customers overcome difficulties caused by the pandemic.
Earlier in February, ACB launched phase 1 of a 25.000 billion VND loan program to support businesses and individuals facing difficulties in their business operations due to the impact of the Covid-19 pandemic, with preferential interest rates reduced by 0,5%-1,5% compared to commercial interest rates in 2019.
From March 31, 2020, phase 2 of the loan package continued with an additional 10.000 billion VND allocated to customers facing extreme difficulties due to the Covid-19 pandemic, along with preferential terms: loan terms of 36-48 months, a grace period of up to 12 months for principal repayment, and gradual repayment until the loan matures. Interest rates were up to 2% lower than the average interest rates of 2019.
SHB launches a 25.000 billion VND credit package with interest rates reduced by at least 2% per year for both new and existing loans. The first phase involves a 25.000 billion VND credit package with numerous preferential interest rates and banking service fees, notably a minimum 2% reduction in interest rates compared to normal rates. SHB continues to effectively implement solutions to expand credit to production and business sectors, priority sectors, and especially lending to maintain and restore industries and sectors affected by the pandemic.
Next, SHB will waive or reduce interest and fees on existing loans, and offer a minimum preferential interest rate of 2% for existing SHB customers facing difficulties due to the pandemic.
