Effectively implement the State's credit capital investments to attract borrowers
Lai Chau hydroelectric plant is one of the projects implemented with a partial loan from VDB. Photo: Internet |
Promoting and creating premises for socio-economic growth
According to regulations, Vietnam Development Bank (VDB) is a policy bank operating under the model of a one-member limited liability company with 100% charter capital held by the State and for non-profit purposes. Accordingly, the Prime Minister directly exercises owner’s rights and obligations as assigned by the Government or authorizes the Ministry of Finance to implement.
VDB's report said that over the past 17 years, the State's credit capital investments poured into the economy reached over VND200,000 billion, meeting an important part of the capital needs for development of socio-economic infrastructure as well as improving the production capacity of economic sectors through sponsoring and lending about 200 key projects (group A) across the country, including most projects for basic industrial sector.
For example, projects include Son La Hydropower, Lai Chau Hydropower, Dung Quat Oil refinery, Ninh Binh Fertilizer factory, Vinasat 1 and 2 Satellite, Hanoi - Hai Phong Expressway, Bac Lieu Wind power plant, TH True Milk clean and fresh milk plant, Ca Mau Gas-Power-Fertilizer Project…
According to VDB, these projects have come into operation, promoting efficiency, positively impacting the economic restructuring of regions, boosting the country's economic growth, and creating an important premise for the development of industries, fields, and regions that need priority in accordance with the Party and Government's policies and directions in each period.
VDB spends a significant amount of capital lending to projects under social security programs, bringing practical results to the goals of hunger eradication and poverty reduction, and new rural development... In addition, the State's credit capital investments are used to support investment projects abroad such as Xekaman 1 and 3 hydroelectric projects invested in Laos, and socio-economic development investment projects of Corporation 15 poured into some provinces in Laos.
Removing obstacles to attract loans
VDB said that it currently faces many difficulties such as policy mechanisms, lack of financial and human resources... which significantly affect the results and operational efficiency of the system. Therefore, in the VDB restructuring plan and operational orientation 2023-2027 approved by the Prime Minister, the bank aims to implement comprehensive innovation in organizational structure, personnel, administration and technology; and provides new loans for credit capital investments with an average growth rate of about 3-5% for 2023-2025 and about 10% for 2026-2027.
In November 2023, the Government issued Decree No. 78/2023/ND-CP amending and supplementing a number of articles of Decree No. 32/2017/ND-CP dated March 31, 2017 of Government on the State’s credit capital investments with many revised contents. Many bottlenecks and obstacles have been removed, helping to enhance the ability to access the State's credit capital investments.
Specifically, the State’s credit capital investment policies have been revised to focus on lending to large-scale investment projects in the fields of socio-economic infrastructure, industry, and agriculture, difficult arears and especially difficult areas that have a great impact on the economy. The transportation infrastructure projects with large capital needs have been included to the list of borrowers; investment projects in high-tech agricultural zones and high-tech agricultural areas; liquefied natural gas projects have been added to the list.
The maximum level of loan for each project is equal to 70% of the total investment capital of the project (excluding working capital). Outstanding debt for each borrower must not exceed 15% and for a customer group must not exceed 25% of equity capital and the balance of bonds guaranteed by the Government with a remaining term of 5 years or more. The Prime Minister decides on the maximum credit grant exceeding the limit based on the Ministry of Finance’s report and the VDB’s request.
According to Mr. Dao Quang Truong, VDB General Director, with the current equity capital and bond balance guaranteed by the Government, VDB can lend a maximum of up to VND15,000 billion to one customer and VND20,000 billion to customer group. Moreover, the change in the method of determining loan interest rates, and open regulations on credit conditions as well as the VDB authority, will facilitate customers that have investment projects approved by the Government in accessing the State's capital.
Currently, 104 projects have been implemented procedures for loans worth VND 67,430 billion at transaction branches and offices, of which, the disbursement need for 2024 is VND18,018 billion
VDB said it will proactively and actively implement the State's policies, creating attractiveness for borrowers. According to the General Director, VDB will determine and promptly announce interest rates for the State’s credit investment loans based on documents from the State Bank and the Ministry of Finance on average lending interest rate data of domestic commercial banks during the same period. It has fully promulgated regulations to guide, train human resources, save costs to reduce loan interest rates, modernize technology to optimize appraisal time for investment projects.
Leaders of many state-owned and private enterprises highly appreciate the support from the State's credit capital investments. Mr. Nguyen Hoang, Chairman of Hanoi Supporting Industry Business Association (Hansiba), Chairman of the Board of Directors of N&G Group, said that the State's credit capital investments have supported industrial enterprises, helping to develop infrastructure of industrial parks to meet the global production chain. |
Related News
Banks with the problem of promoting credit growth
18:49 | 20/07/2024 Finance
Promote information transparency to increase large-scale investors in stock market
15:24 | 09/07/2024 Finance
MoF publishes disbursement key projects in the Transport sector
11:24 | 29/06/2024 Finance
Ensure stability and prevent fluctuation in price levels
10:06 | 01/07/2024 Finance
Latest News
Perfecting the legal framework to promote upgrading the stock market
08:18 | 26/07/2024 Finance
Margin loan continues hit new record
09:20 | 25/07/2024 Finance
Vietnam needs comprehensive regulatory framework to attract green financing
14:11 | 24/07/2024 Finance
2025 budget estimation must be practical, accurate and efficient
14:38 | 23/07/2024 Finance
More News
The corporate bond market will be more vibrant in the second half of the year
08:20 | 23/07/2024 Finance
Prioritize resources and promptly supplement capital for policy credit
10:06 | 22/07/2024 Finance
Measures suggested to boost startups’ access to capital
19:38 | 21/07/2024 Finance
Inflationary pressure seen from monetary policy
09:47 | 21/07/2024 Finance
Proposal to increase Special Consumption Tax on tobacco products
09:50 | 20/07/2024 Finance
Savings of individual customers at banks hit record high
14:30 | 19/07/2024 Finance
Managing fiscal policy has achieved many positive and comprehensive results
14:12 | 19/07/2024 Finance
Determine tools, policy for inflation control
14:11 | 19/07/2024 Finance
The impact of wage increases on inflation will not be too significant
10:23 | 18/07/2024 Finance
Your care
Perfecting the legal framework to promote upgrading the stock market
08:18 | 26/07/2024 Finance
Margin loan continues hit new record
09:20 | 25/07/2024 Finance
Vietnam needs comprehensive regulatory framework to attract green financing
14:11 | 24/07/2024 Finance
2025 budget estimation must be practical, accurate and efficient
14:38 | 23/07/2024 Finance
The corporate bond market will be more vibrant in the second half of the year
08:20 | 23/07/2024 Finance