Active and strong support for businesses

tHu trAng

BIDV and the banking industry have actively and uniformly implemented solutions to support customers affected by the Covid-19 pandemic.

SOLUTIONS TO EASE DIFFICULTIES FOR BORROwERS

Since the beginning of 2021, BIDV has implemented preferential credit packages to support businesses and people to access capital at a reasonable cost to promote production and business activities, overcome difficulties caused by the Covid-19 pandemic. These include short-term credit packages of more than VND350 trillion (USD15.2 billion) at the average interest rate of 4.5~5.0 percent/ year, 1-2 percent/year lower than the normal lending rate; a foreign currency loan package of USD1 billion at the average lending rate of only about 2.5 percent/year, 1-1.5 percent lower than the normal lending rate. Especially for some import-export customers, the preferential lending rate is only between 1.5 percent and 2.0 percent.

For medium and long-term credit, BIDV has launched credit packages totaling up to VND65 trillion (USD2.8 billion) at an average lending rate of 7.1 percent/ year only, 1.5 -2 percent/year lower than the bank’s average medium and long-term interest rate. In particular, BIDV has implemented a VND35 trillion (USD1.5 billion) medium and long-term credit package with lending interest rate fixed in 5 years which enables customers to easily determine financial costs during their investment period.

Following the direction of the State Bank of Vietnam, BIDV has also directed branches across the system, especially those in the pandemic areas such as Bac Ninh, Bac Giang, Hai Duong, Quang Ninh, and Ho Chi Minh City... to ensure pandemic prevention and control measures, comply with the direction of the Prime Minister, the National Steering Committee for Covid-19 Prevention and Control and local authorities. At the same time, the bank’s branches

also proactively developed operating plans and scenarios to ensure business continuity, in all situations, to fully meet the needs for capital and banking products and services of businesses and people. BIDV branches in areas where businesses and people are harvesting agricultural products have actively coordinated with local authorities and customers to find out the needs to provide capital for production in a timely manner according to the direction by the State Bank and provincial authorities.

POLICIES FOR CUSTOMERS AFFECTED BY COVID-19

In addition to providing credit programs with preferential interest rates, BIDV has offered service fee reduction and exemption for customers such as free money transfer on e-banking, free payroll payment, free connection from customer's ERP system to BIDV's e-banking system, free online bill payment, electronic collection and payment, and virtual accounts, etc. In order to support small and medium enterprises to accelerate digital transformation, BIDV has implemented a free two-year use fee for BMP business management software, and MISA accounting software.

On top of that, following the direction of the State Bank of Vietnam on debt structuring, maintaining the debt group for customers affected by the Covid-19 pandemic, BIDV has actively implemented the restructuring of debt repayment period, exempting, reducing interest and fees, maintaining debt group for customers in accordance with the regulation of the State Bank, particularly: by the end of April 2021, BIDV had restructured debt, keeping the debt group unchanged for more than 2,300 corporate customers with a total restructured principal and interest of nearly VND23 trillion (USD1 billion). BIDV has also reduced lending rate on existing outstanding loans of 127 corporate customers (loans disbursed before 1 April 2020) affected by the Covid-19 pandemic worth VND36 billion (USD1.6 million).

BIDV's total net income reduction due to interest exemption and reduction and debt structuring in 2020 was nearly VND6,000 billion. BIDV estimated that the total resources BIDV supports customers affected by the Covid-19 pandemic in 2021 are up to VND6,100 billion (USD265 million).

Currently, interest rates are still basically stable, an uptrend is possible but not too much at the end of the year when credit demand increases. As a state-owned commercial bank pioneering in implementing guidelines and policies of the Government and the State Bank, contributing to the macroeconomic stability, BIDV has been implementing solutions such as: cutting costs, effectively restructuring capital sources to facilitate further reduction of lending interest rates, supporting and accompanying businesses and people to overcome difficulties, contributing to the recovery of production and business after the pandemic.

Although it is difficult to increase deposit interest rates and maintain stable lending rates to support businesses, as a market leader BIDV has been implementing many other solutions to accompany and support businesses.