On October 22, 2021, the State Bank of Vietnam (SBV), in coordination with the Binh Duong Provincial People's Committee, organized a virtual conference on the solutions of the banking industry to contribute to the recovery of production and business activities of the COVID-affected enterprises. The conference was chaired by SBV First Deputy Governor Dao Minh Tu.
SBV Deputy Governor Dao Minh Tu delivers his opening speech
Sharing the difficulties with and accompanying the enterprises
In his opening speech, Deputy Governor Dao Minh Tu emphasized that, over the past time, the SBV and the banking industry have actively joined hands with the whole political system, together with the relevant ministries, agencies, and local authorities to help the COVID-affected people and businesses to overcome the difficulties and to recover production and business operations through specific solutions, such as: managing the monetary policy in an active and flexible manner in order to control the inflation; maintaining the macro-economic stability and the stability of the money and forex markets; managing the credit policies toward concentrating capital for production and business acitivities; supporting the economic growth; proactively regulating the money supply; ensuring the liquidity for the economy; focusing on lending to the priority areas, especially the key sectors and the areas/sectors that have been seriously affected by the coronavirus outbreaks; having issued Circular 14/2021/TT-NHNN amending and supplementing Circular No. 01/2020/TT-NHNN dated March 13, 2020 and Circular No.03/2021/TT-NHNN dated April 2, 2021 in the direction of expanding the scope of debts which are rescheduled, waiving and reducing the interest, maintaining the debt classifications. In addition, the SBV has directed the credit institutions to cut down on their costs to further reduce their lending interest rates, helping to resolve many difficulties of their customers who have been affected by the COVID-19 pandemic.
First Deputy Governor Dao Minh Tu speaks at the Conference from the SBV Headquarters
In addition to those efforts, the banking industry has also actively implemented the support policies in line with the directions of the National Assembly, the Government and the Prime Minister, such as: providing refinancing resources to the VBSP with the interest rate of 0% p.a. in order for the VBSP to provide credit to employers for payment of work suspension benefits and wages and to recover their production in accordance with the Government's Resolution. By the end of September 2021, the loan outstandings of all borrowers in Binh Duong province had reached VND 241 trillion, an increase of 5.15% as compared to the end of 2020 (lower than the national credit growth of 7.54%). Although the NPL ratio had been controlled at less than 1%, it is tending to increase as compared to the beginning of the year, and there are still many potential risks in the context that most of the enterprises have been suffering from losses and operational suspension, loss of consumption markets and failure to pay due debts due to the impacts of the pandemic.
According to the SBV Deputy Governor's assessment, the credit institutions have been demonstrating strongly the spirit of sharing and supporting their customers to overcome the difficulties and to recover the production and business operations through specific solutions.
Representative of the SBV Binh Duong provincial branch speaks at the Conference
With the great efforts of the whole banking system, up to now, the credit institutions have restructured debt repayment terms for 278,000 borrowers with the total outstanding loan of VND 238,000 billion; the accumulated debts of which payment had been rescheduled and debt classifications maintained since January 23, 2020 were VND 531,000 billion; exempted and reduced interest rates for over 1.7 million customers, with a total loan outstanding of over VND 2,500 trillion; provided new loans with lower interest rates with an accumulated amount since January 23, 2020 of VND 5,200 trillion for 800,000 customers. In Binh Duong province, the credit institutions have restructured debt repayment terms and maintained debt classifications for 4,700 borrowers with the total outstanding loan of VND 10,000 billion; exempted and reduced interest rates for over 69,300 customers, with a total loan outstanding of VND 130,000 billion; provided new loans with lower interest rates with an accumulated amount since January 23, 2020 of VND 223,000 billion for 13,300 customers. These results have promptly removed many difficulties and helped a lot of people and businesses to recover their production and business operations, greatly contributing to maintaining the macro-economic stability and supporting the economic growth.
Drastically implementing effective solutions to remove difficulties for customers
In his concluding remarks at the Conference, First Deputy Governor Dao Minh Tu requested the banking entities to enhance and accelerate the implementation of the key tasks in the coming time.
For the credit institutions and their branches in Binh Duong province: Drastically and effectively implement solutions to remove difficulties their for customers in line with the directions of the SBV Governor in Directive No. 01/CT-NHNN dated January 7, 20212021, Circular No.01/2020/TT-NHNN dated March 12, 2020 (as amended by Circular No.03/2021/TT-NHNN and Circular No.14/2021/TT-NHNN), Document No. 3947/ NHNN-TD dated June 3, 2021, Documents No. 5901/NHNN-TD and 5902/NHNN-TD dated August 16, 2021 in the direction of sharing difficulties with the people and the businesses during and after the pandemic;
Accelerating the implementation of the solutions in Decision No.1284/QD-NHNN promulgating the Action Plan of the banking sector to implement Resolution No.63/NQ-CP dated June 29, 2021 on the key tasks and solutions to promote the economic growth, the disbursement of public investment and sustainable exports in the remaining months of 2021 and early 2022.
The credit institutions are also requested to continue to implement synchronous solutions to remove the difficulties for the COVID-affected customers, such as rescheduling the repayment terms, exempting and reducing the interest, lowering the interest rates, actively balancing capital to invest in effective projects in the new situation. In addition, the credit institutions must also accelerate the implementation of the commitments of reducing the interest rates for the current loan outstandings with a scale of over VND 20,613 billion (as committed by 16 commercial banks). Especially, the four state-owned commercial banks shall provide an additional support package worth VND 4,000 billion through reducing the interest rates for their customers).
The SBV Binh Duong provincial branch was also requested to direct the local branches of the credit institutions to accelerate the implementation of the solutions to remove difficulties for the COVID-affected customers; regularly work with the local associations and business communities to acquire and handle any proposals and complaints regarding the banking operations, etc.
The SBV Deputy Governor also requested the VBSP to effectively and consistently conduct support policies on providing credit to allow employers to pay work suspension benefits and wages to recover their production in line with Resolution No.68/NQ-CP of the Government and Decision 23/2021/QD-TTg of the Prime Minister. Besides, the SBV Deputy Governor also suggested that the Provincial Party Committee, the People's Committee, and the People's Council of Binh Duong province, together with the relevant departments and agencies and the business associations should continue to coordinate with one another to help the local business communities to overcome their difficulties, recover their production and business operations, and create a momentum for the economic development in the coming time.
Le Hang