SBV to continue funding small banks in Q3

The State Bank of Vietnam, the country’s Central Bank will continue supporting liquidity of small-sized banks, keep the stability of interbank market, and stabilize saving and lending interest rates in the third quarter of 2011, Nguyen Ngoc Bao-Head of Monetary Policy Department said.
In addition, the Central Bank will continue conducting strict checks and punish violations with an estimated punishment of up to 500 million dong.

Lately SBV ordered banks to restructure investment portfolio of corporate bonds, withdraw guaranteed debts from enterprises, and urged banks to reduce operation scope in the interbank market so as to be appropriate with lending.

At this time, many banks have run out of room for lending (credit growth is targeted at 20% for the full year). Those with too high credit growth will have to withdraw debts and also bring the non-production lending ratio to 22% by June 30 and 16% by the year end.

Keeping the ceiling deposit rate of the dong at 14% a year and US dollar at 0.5% pa, and the maximum saving rate of US dollar for individuals is only 2% pa, the SBV is considering whether announcing information of credit institutions transparently to residents. – Vietbiz24

Tags: Vietnam banking industry, Vietnam finance, Vietnam financial

Posted by VBN on Jun 22 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