Credit growth to slow to 6 pct
The commercial banking system expects to see credit grow by 6 percent this year, well below the Government target of 8-10 percent, said Saigon Economic Times in its recent report.
Credit growth in HCM City alone is expected to rise by only 5.4 percent, far below the 7.7 percent pace seen in 2011, the State Bank of Vietnam branch in the city reported.
Despite the slow growth in lending, the credit structure of commercial banks has changed significantly since the beginning of the year. According to the State Bank website, the rate of short-term capital used for long- and medium-term lending was 17.36 percent as of October 31, a much higher figure than the 7.58 percent logged in April.
Interest rates remain under control, with the interbank rate for loans in domestic currency down to 2.5 percent as of December 16 from a high of up to 4.8 percent earlier in the month.
The central bank has also increased foreign reserves and actively pumped cash into the banking system to sustain liquidity and stimulate economic growth.
Banks are also seeing success in attracting deposits, which have grown by nearly 16 percent industry-wide through last month, according to State Bank statistics.
Overall, the money supply in the commercial banking system as of November, including cash on hand, deposits at the central bank, and reserves, has risen 15.3 percent since the beginning of the year.