Credit growth for the remainder of the year will be driven by imports and exports, according to a recent survey by the State Bank of Vietnam (SBV).
The State Bank of Vietnam (SBV) announced it could adjust monetary policies, including credit growth and incentives, in the remaining months of the year to cope with the COVID-19 pandemic.
The State Bank of Vietnam could increase credit growth limits for credit institutions this year or even launch stronger monetary policies to aid the country’s post-pandemic growth, Governor Le Minh Hung has said.
Experts have forecast bank credit growth in the second quarter to reach 3.5-4%, much higher than the rate in the first quarter.
Credit grew only 1.96% as of May 29 as compared with late 2019, due to the impact of the COVID-19 pandemic, according to Deputy Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong.
Many commercial banks are proposing the central bank to extend credit growth limits as they have nearly reached the allowed threshold.
Credit growth would likely reach only 9-10% this year against 13% last year even if the country’s infrastructure investment was good, experts forecast.
Vietnam’s credit growth is forecast to slow to only 8% in 2020 from 13.7% last year due to a sharp slowdown in economic activity amid the COVID-19 pandemic.
Credit grew over 13 percent in 2019, slightly below the yearly target of 14 percent, a senior official from the State Bank of Vietnam (SBV) told a recent press conference.
Vietnam’s economic growth continues to be driven by the resilient foreign sector and robust domestic consumption.
Credit growth has expanded by 8.4 per cent against the end of 2018 so far this year, the General Statistics Office reported.
The State Bank of Vietnam (SBV) said it will closely monitor interest rates offered by credit institutions and take measures to strictly handle violations of the law, including cutting credit growth targets.
Though many banks have posted positive profits in the first half of 2019, their bad debts have continually increased in the wake of high credit growth in risky business segments.
VOV.VN - The soaring credit growth recorded during the first half of 2019 can be attributed to efforts by local firms to complete periodical business reports and some banks’ application of Basel II standards, a senior banking expert has claimed.
The banking sector reported a credit growth of 7.33 percent in the first half of this year compared to the end of 2018, Governor of the State Bank of Vietnam (SBV) Le Minh Hung said.
The State Bank of Vietnam (SBV) obtained a large amount of foreign currencies in the first half of 2019, pushing foreign exchange reserves recorded in the period to the highest level to date.
Though there remains six months, some banks have almost used up the assigned quota for the whole year, and experts said it would be difficult for the banks to get an expansion approval from the State Bank of Vietnam (SBV).
The credit growth of Vietnamese banks in the first five months of this year expanded by 5.07 per cent against the end of 2018, the State Bank of Vietnam (SBV) reported.
Despite credit growth among Vietnamese credit institutions remaining low this year, experts are not concerned about the slowdown, saying it was a good sign for the economy.
VOV.VN - Vietnam’s real estate market would see a decline in supply due to tight credit and land fund, experts have claimed.