Bank credit for agriculture and export grows over 30pct

At the meeting between the State Bank of Vietnam (SBV) and 12 large banks on Oct. 4, SBV’s governor, Nguyen Van Binh, reported the general situation of monetary operations and credit and the implementation of banking system’s key task in remaining months of this year whereby most banks have been strictly implementing the central bank’s regulation on deposit interest rate cap in dong and foreign currency.
Violations were also detected and promptly treated.

Many banks reduced the dong lending interest rate for production sector from 18-22% per year to 17-19% per year while the interbank interest rates were relatively stable and at suitable levels.

As calculated by Vietbiz24.com, from September 8 so far, over 30 trillion dong credit has been spared for enterprises with preferential interest rate of 16-19% per year.

Credit structure has been in a positive transformation, production credit was up high, especially credit for agricultural, rural area and exports grew above 30%. Foreign currency credit and credit for non-production sector declined.

According to the central bank, the total deposits and credit in the first 20 days of September decreased due to the re-accounting of the proper nature of the deposits and loans previously but there were signs of rise again as from September 23, 2011, reflecting a healthy and true growth.

However, the central bank offered some issues that need to be further processed in the upcoming time such as decrease in capital mobilization in dong will affect the liquidity of some credit institutions. In addition, the launching of promotion programs in capital mobilization activities of some credit institutions made the saving interest rate exceed the allowable ceiling level.

According to the local newswire VnEconomy, as of September 12, credit growth of the whole banking system was 8.63% against December 2010 but the credit decreased 0.48% compared to August 31, 2011.

The total deposits as of September 12 compared to December 31, 2010 increased 10.72% (including valuable papers held by credit institutions). In comparison with August 31, 2011, the total deposits decreased 0.26%. – Source: Vietbiz24.com

Tags: Vietnam banking industry, Vietnam finance, Vietnam financial