Bank deposits and loans in Sept. fall on re-accounting

Governor of the State Bank of Vietnam (SBV) Nguyen Van Binh said at a meeting with 12 large banks on Oct. 4 that deposits and loans in the first 20 days of September decreased due to the re-accounting of the nature of deposits and loans in the past.
In addition, many banks have recently decreased lending interest rates in dong for the manufacturing sector from 18-22% / year to 17-19% / year, while the interest rate of the interbank market remained relatively stable at a reasonable level.

According to the SBV governor, the production credit has increased at a high level, especially in agricultural and rural development credit, and export credit (growing over 30%), while foreign currency credit and non-production loans declined significantly and the liquidity of commercial banks was controlled.

The Governor also said that there are some issues that need to be further processed in the near future such as dong deposit reduction will affect the liquidity of some banks, and some banks are offering capital-raising promotions, which makes the interest rates exceed the prescribed interest rate ceilings of the central bank, and banks’ using foreign capital to expand lending in foreign currencies will increase liquidity risks.

Besides, the issues of accounting and statistical methods of commercial banks need to be further processed to reflect the mobilization of capital and credit expansion along with the volatility of gold prices, and gold trading activities causing pressures on the dong/dollar exchange rate and foreign exchange market. – Source: Vietbiz24.com

Tags: Vietnam banking industry, Vietnam finance, Vietnam financial

Posted by VBN on Oct 7 2011. Filed under Banking-Finance. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry