HCMC – Vietnam’s central bank has proposed that commercial banks extend debt repayment deadlines by up to one year for their clients in 26 northern provinces and cities hit by typhoon Yagi.
The State Bank of Vietnam (SBV) is seeking feedback on a draft circular to support borrowers facing financial challenges due to the typhoon. Under the proposal, banks could restructure repayments of loans taken out before September 7, when the storm struck northern Vietnam, with payments originally due between September 7 and the end of next year.
Borrowers would have up to three months from the circular’s effective date to apply for restructuring, which would be limited to one year. However, all restructured loans must be fully repaid by December 31, 2026.
Banks have indicated that the measure is crucial to prevent defaults, as many affected individuals and businesses are currently facing financial difficulties.
Since the storm, 32 banks have reduced interest rates by 0.5 to two percentage points for affected individuals and small businesses, covering loans worth VND405 trillion.
As of September 25, nearly 94,000 customers with total debt of VND165 trillion had been impacted by the storm and ensuing flooding, according to SBV Governor Nguyen Thi Hong.
The policy will apply to borrowers in the provinces and cities of Ha Giang, Cao Bang, Lang Son, Bac Giang, Phu Tho, Thai Nguyen, Bac Kan, Tuyen Quang, Lao Cai, Yen Bai, Lai Chau, Son La, Dien Bien, Hoa Binh, Haiphong, Hai Duong, Hung Yen, Vinh Phuc, Bac Ninh, Thai Binh, Nam Dinh, Ha Nam, Ninh Binh, Quang Ninh, Thanh Hoa, and Hanoi.
