BANKS CONTINUALLY CUT LENDING RATES TO AID PANDEMIC AFFECTED CUSTOMERS

Commercial banks have continuously announced lending interest rate reductions to support and accompany customers to overcome the adverse impacts of the COVID-19 pandemic.

Vietcombank was the latest to announce a rate cut for loans from August 18, 2021 to December 31, 2021 for all businesses and individuals severely affected by the pandemic in 19 southern provinces and cities and currently applying social distancing according to the Government’s Directive 16.

This was Vietcombank's ninth interest rate reduction to support businesses and people affected by the pandemic and natural disasters since the beginning of 2020.

Specifically, Vietcombank has continued to reduce interest rates of up to 0.5 per cent per year for all outstanding loans of customers in HCM City and Bình Dương Province. The decreasing rate for customers in other southern provinces and cities under the application of social distancing including Đồng Nai, Cần Thơ, Bình Phước, Tây Ninh, Bà Rịa - Vũng Tàu, Tiền Giang, Long An, Vĩnh Long, Đồng Tháp, Bến Tre, Hậu Giang, An Giang, Bạc Liêu, Sóc Trăng, Trà Vinh, Cà Mau, Kiên Giang is 0.3 per cent per year.

Previously, Vietcombank implemented a policy of reducing interest rates worth up to VNĐ1.8 trillion to support customers affected by the pandemic nationwide from July 15, 2021 to December 31, 2021 with a reduction of 0.5-1 per cent per year depending on the customers.

BIDV has announced to set aside up to VNĐ1 trillion to reduce lending interest rates for existing loans, and deploy new loan packages with low interest rates from this month to December 31, 2021.

Specifically, BIDV’s interest rate has been reduced by 0.5-1.5 per cent per year for existing outstanding loans up to July 15, 2021 of enterprises whose business and production have faced difficulties due to the impact of the COVID-19 pandemic. The maximum reduction has been applied for loans that have been heavily affected in industries including transportation, healthcare, education, accommodation services, restaurant services, hotels and resorts.

Meanwhile, at VietinBank, a VNĐ20 trillion preferential credit package with an interest rate of 4.0 per cent per year has just been added, increasing the total value of the package to VNĐ150 trillion.

Agribank has also continued to spend VNĐ5.5 trillion to cut lending rates for customers until the end of this year.

Many other banks such as ACB, SeABank, MSB, HDBank, Sacombank have also announced a popular interest rate reduction of 1 per cent per year for customers with difficulties, applied from July 15, 2021.

Regarding the implementation of interest rate reduction and free banking services provision to support customers affected by the pandemic, the State Bank of Vietnam (SBV) recently issued Official Dispatch No. 5901/NHNN-TD, requiring commercial banks to reduce lending interest rates as per their previous commitments.

Previously, under the SBV’s direction, the Vietnam Banks Association held a meeting with the participation of 16 commercial banks who voluntarily agreed to cut interest rates of about VNĐ20.3 trillion from now until the end of this year, depending on the size of the bank, to support the economy amid the pandemic.

SBV’s Deputy Governor Đào Minh Tú said the central bank would strengthen supervision of the implementation of the dispatch.

Source: VNS