Log in
Business

Vietnam banks restructure debts worth over US$24 billion during pandemic

Banks have foregone around VND31.4 trillion ($1.38 billion) in profits by lowering lending rates from January 23, 2020, to late October 2021.

As of October, banks and credit institutions in Vietnam have restructured the debt payment schedules for over 500,000 customers affected by the pandemic with total outstanding loans of VND260 trillion ($11.5 billion).

 Customers at a SeABank branch in Hanoi. Photo: Tran Anh

This resulted in a total of VND550 trillion ($24.3 billion) since the Covid-19 pandemic first emerged in Vietnam in early 2020, the State Bank of Vietnam (SBV) revealed the figures reflecting efforts of the banking sector to address difficulties for the business community in accessing credit support for production resumption.

In addition, commercial banks under the instruction of the SBV have waived and lowered lending rates for nearly two million customers with total outstanding loans of VND3,790 trillion ($167.5 billion).

According to the central bank, banks have foregone around VND31.4 trillion ($1.38 billion) in profits by lowering lending rates from January 23, 2020, to late October 2021.

Over 1.2 million customers have also been able to access loans with preferential rates of over VND7,000 trillion ($309 billion).

The state-run Vietnam Bank for Social Policies (VBSP) alone has extended debt payment for around 260,000 customers for total loans of VND6.06 trillion ($267.5 million), along with new loans of VND130 trillion ($5.74 billion) for 3.5 million eligible customers.

While providing credit support for businesses, SBV Governor Nguyen Thi Hong warned Vietnam is facing high inflationary pressure next year, especially as countries around the world are pushing for economic recovery and prices of goods and products are rising.

Hong pointed out the fact that a number of major economies have seen record-high inflation such as the US, South Korea, or Europe in the last months, forcing central banks to ease monetary policies and raise inflation rates. 

“Vietnam, one of the most open economies in the world with its trade-to-GDP ratio at over 200%, is highly vulnerable to imported inflation,” she added.

For the domestic market, Hong expressed concern over the rising bad debts in the banking sector. “Banks have been lowering lending rates with their own resources, so they are on their own when dealing with bad debts,” she noted.

“The SBV is committed to further aiding the economy, but at the same time putting priorities on ensuring the national financial safety,” Hong suggested.

Reactions:
Share:
Trending
Most Viewed
Related news
Vietnam drafts strategy to attract science, tech talent

Vietnam drafts strategy to attract science, tech talent

Recently issued strategic resolutions all identify the development of high-quality talent as essential to successfully implementing national transformation goals.

Vietnam earns US$92 billion from ICT revenue in H1

Vietnam earns US$92 billion from ICT revenue in H1

The sector is expected to generate US$169.3 billion in revenue by 2025, up 11.4% from 2024.

Hanoi pilots digital document exchange platform to support businesses

Hanoi pilots digital document exchange platform to support businesses

Once fully operational, the system could establish a comprehensive digital ecosystem linking the government and businesses.

CMC to build US$250 million green data center in Ho Chi Minh City

CMC to build US$250 million green data center in Ho Chi Minh City

Construction on the hyperscale data center is expected to begin in 2026.

Green logistics becomes a must for Vietnamese firms

Green logistics becomes a must for Vietnamese firms

Experts have called for greater policy dialogue, technology transfer and investment collaboration to enable Vietnamese logistics companies to implement green transformations effectively.

Coca-Cola inaugurates US$136 million green-certified plant in Vietnam

Coca-Cola inaugurates US$136 million green-certified plant in Vietnam

The new plant is the company’s largest of its three production facilities in Vietnam.

Vietnam pledges deeper reforms: Prime Minister

Vietnam pledges deeper reforms: Prime Minister

The government is transitioning from a passive management approach to an active service delivery model to optimize conditions for both citizens and enterprises.

Hoa Phat to build US$130-million industrial park in northern Vietnam

Hoa Phat to build US$130-million industrial park in northern Vietnam

The Hoang Dieu Industrial Park is poised to become a premier destination for domestic and international investors in northern Vietnam.