SBV urges banks to keep closer eye on credit activities

The State Bank of Vietnam (SBV) on April 14 requested local credit institutions and foreign bank branches to keep a closer eye on their credit activities in line with Government’s Resolution 11.

Specifically, the central bank asked commercial banks to seriously take measures to ensure credit growth at below 20%(after taking account dong devaluation adjustments) in 2011 including setting specific targets for each quarter and assigning quarterly and the year targets to their branches and transaction offices.

Local lenders must report their business targets in 2011 to the SBV (though the Monetary Policy Department) before April 22, the central bank noted.

The SBV also requested local lenders to reduce non production lending including real estate , stocks and consumption loans in their loan structure to at most 22% by June 30 and 16% by December 31 this year, threatening to double reserve requirements for those who failed to do so.

They must report their non production loans monthly to the SBV (though the Monetary Policy Department ) on 12th of the following month, the SBV requested.

Should the SBV not receive any local banks’ report of non production loans in June and December before July 12, 2011 and January 12, 2012, it would use loan figures in May and November to apply reserve ratios as noted above. – Stoxplus.com

Tags: Vietnam banking industry, Vietnam finance, Vietnam financial