The central bank assigns an annual credit growth quota for each bank to control lending and thus ensure money supply and inflation control as targeted by the Government.
Chairman of Vietcombank Nghiem Xuan Thanh said the central bank had set the bank’s quota at 16% for the whole year, but in the first half of the year it had already reached 13% growth.
Vietcombank has therefore requested a higher credit growth cap to meet rising capital demands, especially at the end of the year during peak business and spending seasons.
The Vietnam International Commercial Joint Stock Bank (VIB) has also used up almost all its entire credit growth quota of 16% assigned for 2017. Its outstanding loans reached nearly VND75.7 trillion in H1, up by 15.7%.
VIB’s general director Han Ngoc Vu said the bank had asked SBV to expand the credit growth limit to provide more scope for lending at the end of the year.
HDBank’s credit growth by the end of June also reached 18%, compared with 20% assigned by the central bank. The bank’s lending growth in H1 was mainly from short-term loans worth VND50 trillion, accounting for 51.6% of the bank’s total outstanding loans.
Outstanding loans of the Vietnam Prosperity Commercial Joint Stock Bank (VPBank) in H1 also grew by 12% to VND162 trillion. VPBank has only 4% left from the assigned credit growth limit of 16% to develop lending in the remaining six months of 2017.
General Director of ACB Do Minh Toan also said that in H1 2017, his bank used over half of the credit growth limit of 16% and is waiting for SBV approval for an expansion.
ACB needs more credit growth room as it has been promoting a retail strategy, which focuses on credit for individual customers and small- and medium-sized enterprises, Toan said.
According to SBV data, the credit of the entire banking system grew 9.06% in the first half of 2017, the highest level in the past six years.
At a recent meeting, the Prime Minister asked SBV to increase the credit growth target to 20% from the current 18% cap, as planned previously, to support the country’s economic growth.
Banking expert Bui Quang Tin said the current credit growth rate is in line with the SBV’s direction. He forecast that in the remaining months of 2017, SBV will still control lending growth, but will also make flexible adjustments to achieve the targets set by the National Assembly and the Government.