Coordination is needed to effectively implement the 500,000 billion VND credit package.

Concerned about loan terms

Deputy Governor of the State Bank of Vietnam (SBV) Dao Minh Tu said that banks have committed to participate, basically enough 500,000 billion VND and there are many incentives for projects, such as preferential interest rates, medium and long-term loans. However, Mr. Tu also said that banks face pressure when participating in this credit package.

Ms. Ha Thu Giang - Director of the Department of Credit for Economic Sectors (SBV) added that there are currently 21 banks registered to participate with a total scale of VND500,000 billion. The expected interest rate of this package is at least 1% lower than the current lending level, this interest rate is applied for at least 2 years. However, banks are having some concerns about the lending policy of this credit package.

Specifically, according to Ms. Giang, many banks have suggested that there should be a mechanism to support commercial banks to participate. Such as clarifying the lending subjects, having a risk control mechanism or a guarantee mechanism (which can be a government guarantee or a revenue guarantee). Notably, commercial banks want to have a commitment from competent state agencies to implement projects on schedule and to completely handle projects that have been stuck and difficult in the past.

Mr. Pham Chi Quang - Director of the Monetary Policy Department (SBV) said that the VND500,000 billion credit package is a very large number, with the loan term of some projects being up to 20 - 30 years. This means that there will be risks for banks because banking is a special field, 80% of capital is mobilized in the short term, so caution is needed in lending in the medium and long term.

Most state-owned commercial banks are concerned about the loan term for this credit package. Mr. Le Ngoc Lam - General Director of BIDV said that there should be some support mechanisms so that banks can have lower-cost capital to support projects in this credit package. Because in reality, infrastructure projects often have very long loan terms, maybe 20 years or 25 years. Meanwhile, banks often mobilize short-term capital, so when lending for a long time, they will also encounter many difficulties; not to mention that there may be risks in the process of implementing this loan package.

Mr. Le Quang Vinh - General Director of Vietcombank also said that in order to effectively implement this preferential loan package, ministries and branches need to grant licenses to truly qualified investors to ensure project progress, avoiding general impacts on supporting the economy and bank liquidity if bad debt occurs. "With infrastructure projects that require loans for 15 - 20 years, banks usually do not lend for such a long period because banks have to solve the problem of providing enough medium and long-term capital," said Mr. Vinh.

Mr. To Huy Vu - Chairman of the Board of Directors of Agribank proposed a number of solutions to implement the VND500,000 billion credit package. For example, it is necessary to have a capital plan in each stage so that banks can balance their lending. Determining the preferential interest rate of the loan package also needs to consider a number of factors such as high inflation creating pressure on interest rates and increasing exchange rates.

Close coordination between ministries, branches and localities is needed.

According to Vietinbank representative, to effectively implement this credit package, it is necessary to complete policies on infrastructure investment and public investment; Establish unified costs for selecting investors, and evaluate the financial capacity of investors, requiring the participation of credit institutions because credit institutions are the units providing money to implement the project.

Mr. Pham Chi Quang also said that to effectively implement this credit package, many synchronous activities are needed. For example, if there is a lack of planning strategy, banks cannot lend. “The State Bank, specialized departments and agencies will adjust regulations in the direction of supporting capital for commercial banks participating in this project. But at least we need to know what the planning of the industry, the country, and the localities will be in the next 5 years; Then we need to specify infrastructure strategies so that banks can be bolder and more confident when lending,” Mr. Quang said.

According to Deputy Governor of the State Bank of Vietnam Dao Minh Tu, it is necessary to clearly recognize that banks cannot replace the State's role in regulating public investment capital. This credit package is a support policy, but if there is a lack of synchronization between budget capital and credit capital, the consequence is that the entire banking system will be pushed into a high-risk position. Therefore, there needs to be close, timely, and highly responsible coordination between ministries and branches so that the credit package can be put into practice.

Deputy Governor of the State Bank of Vietnam Dao Minh Tu commented that the coordination mechanism between ministries and branches in implementation has not yet met requirements. Because the current problem does not lie in the scale of capital but in the coordination mechanism and determining priority targets. For example, the State Bank of Vietnam needs to clearly define in at least the next 5 years the list of priority investment projects, the ratio of state capital and socialized capital, provide accurate subjects, clear investment plans, etc. The State Bank of Vietnam needs to have estimated data close to reality so that the State Bank of Vietnam and commercial banks can calculate and balance capital sources, ensuring that the credit package is on the right track.

Hoang Tu

Source: https://baophapluat.vn/can-su-phoi-hop-de-trien-khai-hieu-qua-goi-tin-dung-500000-ty-dong-post546687.html