Sure, I can assist with that. “LPBank’s Proposals at the Permanent Deputy Prime Minister’s Conference with Commercial Banks: Optimizing Financial Strategies for a Brighter Vietnam”

Robust Growth Fueled by Comprehensive Development Strategies

This information was shared by Mr. Ho Nam Tien, CEO of Loc Phat Bank Vietnam (LPBank), at the Standing Government Conference with joint-stock commercial banks on solutions to contribute to the country’s socio-economic development on the afternoon of September 21st.

Mr. Ho Nam Tien, CEO of LPBank, speaks at the conference.

To achieve these results, in 2024, LPBank implemented many synchronized solutions and took decisive action. The bank promoted retail credit development in rural, remote, and mountainous areas through a network of 566 branches and transaction offices in 63 provinces and cities. Additionally, LPBank accelerated its comprehensive digital transformation, providing great support for credit approval and helping to shorten the time required to provide services to customers.

Thanks to the application of strict credit and risk management practices following a modern, safe, and effective governance model, LPBank has effectively controlled credit quality and prevented the occurrence of new bad debts. Currently, the bank’s bad debt ratio is only 1.7%, making it one of the banks with the lowest bad debt ratios in the system. “LPBank’s goal is to bring the bad debt ratio down to below 1.0% by the end of this year,” shared Mr. Ho Nam Tien, CEO of LPBank, at the conference.

In 2024, Loc Phat Bank Vietnam also continuously introduced multiple optimal solution packages to support businesses and individuals. Following the Government’s directive on deploying a VND 120,000 billion credit program for social housing and consumer loans, LPBank launched multiple credit packages with preferential interest rates. In the first eight months of 2024, LPBank reduced interest rates for more than 150,000 customers, with a reduction of up to 3.5% compared to the beginning of the year, equivalent to a total outstanding balance of over VND 100,000 billion being reduced in interest rates.

Prime Minister Pham Minh Chinh and Chairman of LPBank, Nguyen Duc Thuy, engage in open discussions on the sidelines of the Standing Government Conference.

Additionally, there are preferential fixed-interest rate loan programs for corporate customers borrowing for short-term production and business activities and for import-export customers, with a scale of VND 9,000 billion,… and preferential interest rates as low as 6.5%/year. As a result, nearly 900 customers have benefited from this program so far. It can be said that these preferential programs have provided significant support to individual and corporate customers and have been spreading strongly nationwide, contributing to the recovery of production and business activities and promoting local economic development across the country.

Sustainable Development of a Green Bank

Closely following the Prime Minister’s directions on removing obstacles and difficulties regarding mechanisms and policies to mobilize maximum resources for development, the leadership of Loc Phat Bank Vietnam proposed several suggestions.

First, LPBank proposed that the Government, the State Bank, and relevant ministries and branches issue documents and detailed guidance on Carbon Credits and the specific benefits for customers participating in Green Credit.

Currently, LPBank is a pioneer in promoting green credit growth in the system. The bank has launched a dedicated credit package for this field with a limit of more than VND 15,600 billion to support and encourage customers toward the goal of sustainable development for the community and society. Of this, VND 9,600 billion is allocated for green energy projects and VND 6,000 billion for green agriculture projects.

Representatives of the joint-stock commercial banks take a photo with Prime Minister Pham Minh Chinh at the conference.

With a nationwide network of 63 provinces and cities, mainly in rural, remote, and mountainous areas, LPBank’s green credit growth as of the end of the third quarter of 2023 reached an impressive VND 2,863 billion, of which clean agriculture and high-tech agriculture accounted for VND 2,857 billion.

LPBank representative shared: “Climate change is one of the main reasons for the increased frequency and intensity of storms like Yagi. Therefore, we will continue to prioritize green credit in the future to contribute to reducing greenhouse gas emissions, protecting the natural environment, and creating conditions for sustainable economic and social development in the country.”

LPBank’s prioritization of green credit is in line with the direction and guidance of the Prime Minister and the State Bank regarding the shift in capital flow for green credit, promoting sustainable development. This area is also oriented by the Party and the State to become a region for agricultural production with efficient and sustainable growth rates, in line with international integration trends, adaptive to climate change, and capable of enhancing added value. However, according to Mr. Ho Nam Tien, CEO of LPBank, “The policies on green credit lending and the benefits for customers in the green field are still unclear, making it difficult to expand and develop the customer base.” Therefore, Vietnam needs to soon have mechanisms and policies to encourage green transformation for businesses, create conditions for them to participate in the capital market, issue green bonds, and enjoy tax incentives and green credit insurance benefits.

Second, for individuals, households, and businesses affected by the recent Storm No. 3, LPBank proposed additional support policies such as debt restructuring and interest rate reduction to help them quickly overcome the post-storm effects and stabilize their lives and production and business activities.

Third, consider extending Circular 02/2023 on debt rescheduling and maintaining debt groups, while also adding customers affected by Storm No. 3 to the list of supported subjects.

Recently, LPBank has urgently implemented programs to reduce interest rates by 0.5% to a maximum of 2% for customers affected by Storm No. 3. The program has a debt scale of up to VND 29,700 billion for more than 63,200 customers in areas and localities affected by storms and floods, along with appropriate debt restructuring and relief solutions.

“Despite the challenges ahead, with the close direction and practical solutions from the Government, ministries, branches, and the State Bank, LPBank believes that Vietnam’s economy will continue to grow strongly and sustainably in the future.” – affirmed by the CEO of LPBank.