The growth rate was 11.5% in the same period of 2017, 9.67% in the same period of 2016 and 10.23% in the same period of 2015. Despite the slowdown, the report assessed that the growth rate is reasonable, helping the monetary market stabilise in the first eight months of the year.
At a regular cabinet meeting on August 30, Minister-Chairman of the Government Office Mai Tien Dung said that credit growth would be curbed at around 17% this year.
Despite controlled credit growth, loans for production and businesses with stable interest rates have still been ensured, Dung said, noting that in the first eight months of this year, the Government focused on economic restructuring and did not rely on oil exploitation and credit expansion for growth.
At the meeting, Deputy Governor of the State Bank of Vietnam (SBV) Dao Minh Tu also explained that the credit growth target of about 8.5% in the remaining months of this year matches the requirements for economic growth and inflation control.
Tu highlighted the rosy economic growth with inflation tamed at below 4% over the past eight months, but noted that although the inflation rate was below the target set by the Government, caution is still necessary to control the rate in the remaining months of the year.
For the goal of economic stabilisation and ensuring capital for priority areas, credit institutions have set their own plans, Tu said.
To control credit growth at 17% this year, SBV Governor Le Minh Hung earlier also affirmed that the SBV would not adjust upward credit growth limits for commercial banks for the rest of the year though many banks said they were hoping for higher credit limits as they had already used up most, if not all, of their assigned quota for the year.
According to current regulations, SBV sets a credit growth limit for each commercial bank depending on the bank’s health at the beginning of the year. This is done to control credit growth for the entire banking system and to support Government targets.
According to banking expert Nguyen Tri Hieu, the credit slowdown would allow banks to pay more attention to credit quality and credit risk management.
Currently, interest rates are commonly 6%-9% per year for short-term ordinary loans, and 9-11 per year for medium- and long-term ordinary loans.
For loans in priority sectors, including agriculture businesses, firms producing goods for export, small- and medium-sized enterprises, enterprises operating in auxiliary industries and hi-tech enterprises including startups, the lending interest rate is 6.5% per year.