Money supply to increase in last four months of 2011

The Vietnamese government’s target of credit growth at below 20 percent and M2 money supply growth at 15 percent in 2011 is the lowest in the history since 1996, Dr Dinh The Hien, director of the Research Institute for Informatics and Applied Economics said at the conference between banks and enterprises before the impacts of monetary policy held by Vietnam Chamber of Commerce and Industry (VCCI) on September 6.

During 2007-2010, the average credit growth was at 36 percent per year and average M2 money supply growth was at nearly 29 percent per year. However, it was the very high levels against other countries in the world.

As calculated by Hien, in the remaining four months of this year, the credit will increase additional 131 trillion dong, lower than 208 trillion dong of the same period last year. However, the M2 money supply in the late four months of this year would reach over 196 trillion dong, higher than 172 trillion dong of the same period last year.

No long ago, the State Bank of Vietnam (SBV) issued a Circular No 22 to remove the regulation on the ratio of lending on deposits at credit institutions.

According to Bao Viet Securities Co, after this circular, credit institutions will have additional 460 trillion dong for lending activities.

Tags: Vietnam banking industry, Vietnam finance, Vietnam financial

Posted by VBN on Sep 8 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