Banks join the fight against nCoV
The State Bank of Vietnam has directed banks to extend some leeway to customers impacted by the coronavirus outbreak by providing preferential interest, on-lending, or debt restructuring.
On February 4, the State Bank of Vietnam (SBV) issued Document No.541/NHNN-TD requiring banks to implement solutions to support and overcome the damage caused by coronavirus.
Banks have to assess the damage customers sustain, especially businesses that have loans in the sectors of tourism, agriculture, or export to give them timely encouragement by restructuring debts or remitting interest payments.
For instance, ABBank spends VND4 trillion ($173.9 million) in a programme which offers a preferential interest rate of 1.5-2 per cent per year less than normal in the short term, and 3 per cent a year less than normal in medium- and long-term loans.
Or at TPBank, customers in the fields of tourism, agriculture, fisheries, seaports, and shipping who are affected by nCoV will receive support for on-lending or debt restructuring.
According to the document, the nCoV is damaging production and business activities. In order to provide the right conditions to help people and businesses overcome difficulties, the SBV requires its branches in cities and provinces, as well as financial institutions to join the battle against the novel coronavirus (nCoV).
Financial institutions have to ensure capital to meet the needs for production and business activities under the government's Resolution No.01/NQ-CP dated January 1, as well as the SBV's Directive No.01/CT-NHNN dated January 3, 2019 on implementing key tasks of the banking industry in 2020.
The SBV also directed bank branches and transaction offices to proactively understand the situation of production and business as well as the level of damage by nCoV, especially in the fields of tourism, agriculture, or exports to promptly support and handle the difficulties, such as rescheduling debt payments, considering giving exemptions or reductions for loan interest, according to current legal provisions.
The SBV also assigned its branches to promptly advice for the People’s Committee in cities and provinces to find the suitable solutions.
The SBV document also directed banks to submit monthly reports (before the 12th of every month) to the SBV (via the Credit Department) on the results of implementing solutions to remove difficulties for customers who are damaged by nCoV in the area.