Restructuring of debt repayment terms due to the impact of Typhoon No. 3 in Vietnam

Restructuring of debt repayment terms due to the impact of Typhoon No. 3 in Vietnam​ (Image from the internet)

The Governor of the State Bank issued Circular 53/2024/TT-NHNN on December 4, 2024, stipulating the restructuring of debt repayment periods by credit institutions and foreign bank branches for customers facing difficulties due to the impacts, damages, flooding, landslides caused by Typhoon No. 3.

Restructuring of debt repayment terms due to the impact of Typhoon No. 3 in Vietnam

Article 4 of Circular 53/2024/TT-NHNN stipulates that credit institutions and foreign bank branches may consider and decide on restructuring the repayment period for principal and interest balances of loans based on the customer's request, the financial capabilities of the credit institution or foreign bank branch, and compliance with the following conditions:

- Customers of credit institutions or foreign bank branches located in the provinces and centrally-run cities: 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, Hanoi, Hai Phong, Hai Duong, Hung Yen, Vinh Phuc, Bac Ninh, Thai Binh, Nam Dinh, Ha Nam, Ninh Binh, Quang Ninh, Thanh Hoa (hereinafter referred to as 26 provinces, cities) facing difficulties due to the impacts and damages from Typhoon No. 3, including:

+ Individual customers residing, working, having business premises, or engaging in investment, construction, business activities in the 26 provinces, cities;

+ Corporate customers (excluding customers who are credit institutions or foreign bank branches) with headquarters, branches, representative offices, or operating business premises or engaging in investment, construction, business activities in the 26 provinces, cities.

- Having outstanding principal balances incurred before September 7, 2024, from lending activities or financial leasing.

- Having repayment obligations for principal and interest arising between September 7, 2024, and December 31, 2025.

- The outstanding debt balance of the restructured loan must be current or overdue by no more than 10 (ten) days from the agreed-upon repayment date. Credit institutions or foreign bank branches may restructure the repayment period for debt balances overdue by more than 10 (ten) days and overdue between September 7, 2024, and December 16, 2024, when executing the first restructuring of the repayment period pursuant to Circular 53/2024/TT-NHNN.

- Customers are evaluated by the credit institution or foreign bank branch as facing difficulties and incapable of meeting repayment obligations for principal and interest as per the agreed contract due to impacts and damages from Typhoon No. 3, and are capable of fully repaying principal and interest according to the restructured repayment schedule.

- Credit institutions or foreign bank branches shall not restructure the repayment terms for debts that contravene legal regulations.

- The consideration for restructuring the repayment period shall be conducted from December 4, 2024, to the end of December 31, 2025, with no limit on the number of times for restructuring the repayment period.

- The final repayment date for the debt balance with restructured repayment terms shall be determined appropriate to the customer's difficulties but shall not exceed December 31, 2027.

For further details, refer to Circular 53/2024/TT-NHNN effective from December 4, 2024.

>> CLICK HERE TO READ THIS ARTICLE IN VIETNAMESE