VINACHEM

Home loans supported by last year's property bailout package saw a drop in interest rate from 6 per cent to 5 per cent on Thursday.

The move was initiated by the State Bank of Viet Nam (SBV) on Thursday for all home loans that fall within the purview of the Government's VND30 trillion (US$1.43 billion) bailout package for property owners.

Commercial banks were expected to apply the new rate for new loans this year, beginning on the same day, SBV Governor Nguyen Van Binh said while announcing the decision.

In mid-December last year, the total registered loans reached a value of over VND1.65 trillion ($78.57 million), while some VND555 billion ($26.43 million) was disbursed from the package, news website ttvn.vn reported, citing Ministry of Construction and central bank sources.

Credit institutions signed contracts to lend a total amount of VND1.13 trillion ($53.81 million) to businesses and disbursed VND205 billion ($9.76 million). For individual loans, the figures were VND527 billion ($25.1 million) and VND350 billion ($16.67 million), respectively.

The Bank for Investment and Development of Viet Nam, Mekong Housing Bank, Vietcombank, and Vietinbank, as well as Agribank, were responsible for the loans.

SBV Credit Department Director Nguyen Viet Manh told the press recently that the central bank will petition the government to allow more banks to participate in the programme.