Debt restructuring, interest rate reduction

Viet Thang Company Limited in Bac Giang city, one of the enterprises affected by Covid-19 pandemic, is entitled to bank’s incentive policies. According to Le Van Thua, the Company’s Director General, the company faces difficulties in importing materials while the export orders are struck, as a result, its revenue has been sharply decreased compared to the same period last year.

Workers of Bac Giang BGG Garment Corporation finish the products.

Facing the difficulties, the company was lent tens of billions VND by Vietcombank, Bac Giang branch while rescheduling loan repayment by one more period and reducing 10 percent of the total interest rate within 5 months (since 15 April to 30 September this year). The interest rate reduction is estimated at some hundreds of millions VND.

Similarly, Bac Giang BGG Garment Corporation which was directly affected by Covid-19 when failing to import materials and export clothes to foreign market was also supported by Vietcombank Bac Giang with loan repayment rescheduling and reducing 10 percent of the total loan interest rates.

According to Nguyen Xuan The, Head of the Client Department, Vietcombank Bac Giang, the bank has provided debt restructuring and rescheduling to 10 companies and interest rate reduction to more than 1,000 customers directly and indirectly affected by Covid-19 with debit balance of some 3 trillion VND (129.4 million USD), taking nearly 50 percent of the bank’s total debit balance.

According to representative of the State Bank in Bac Giang, the commercial banks have rescheduled loan repayment, provided interest rate reduction and exemption to nearly 3,000 customers. In which, more than 1,900 customers enjoy interest rate reduction and exemption with total debit balance of some 3.4 trillion VND (147 million USD) while the others are entitled to loan repayment rescheduling with total debit balance of nearly 3.6 trillion VND (155 million USD).

Driving enterprises to recover production

In the first months this year, many enterprises in the province had to reduce the business and production scales due to impact of Covid-19 pandemic. Meanwhile, a number of companies face difficulties in paying interest and loan maturity.

In order to ease burden and motivate enterprises’ development, the State Bank in Bac Giang has implemented many solutions to remove loan obstacles for enterprises under directions by the State Bank of Vietnam and the provincial People’s Committee.

Besides, the commercial banks are requested to balance the capital resources for production and business in the locality and reduce interest rates for new loans of the enterprises affected by the pandemic. The State Bank in Bac Giang collaborates with the provincial Business Association to grasp information of the enterprises affected by the pandemic to help remove loan obstacles and conducted inspection on implementation of the commercial banks.

Implementing the above requests, Vietcombank Bac Giang reduces 10 percent of the total loan interest rates for the enterprises directly affected by Covid-19 from 15 April to 30 September 2020 and 5 percent for the enterprises indirectly affected by Covid-19 until 30 June 2020.

Vietcombank also reduces domestic inter-bank transaction fees for enterprises. In line with loan capital restructuring, Agribank Bac Giang reduces interest rates from 0.5 to 2 percent and provides short-term incentive loan interest rates of 5 to 5.5 percent per year for prioritized clients while publicizing the hotline to handle difficulties facing enterprises.

The other banks including Agribank Bac Giang II and Vietinbank Bac Giang also well perform in loan restructuring and interest rate reduction for enterprises affected by the pandemic.

However, enterprises affected by Covid-19 need to urgently submit requests to the banks for verification ensuring all enterprises are entitled to the incentive policies. Those who are not clear about the procedures can call the hotlines or visit the banks for detailed instructions.

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Minh Linh