17:06 | 08/02/2016 Economy
(VEN) - The government has asked the SBV to adjust interest rates in accordance with macroeconomic developments, inflation and the monetary markets. Growth in outstanding credit must be associated with credit quality improvements. In addition, the strict control of credit for the real estate sector is needed.
Capital will be strongly poured into production
The banking sector has set a credit growth target of 18-20 percent this year with a focus on priority sectors. Capital will be strongly poured into production via activities linking banks and enterprises.
The overall goals of the 2016 socioeconomic development plan are to maintain macroeconomic stability, achieve higher economic growth, improve growth quality and ensure sustainable development. In addition, creating strategic breakthroughs, promoting the restructuring of the economy associated with renewing the growth model, improving productivity, effectiveness and competitiveness, overcoming difficulties against businesses and strengthening trade and production activities are vital. To complete the goals, the government has asked the State Bank of Vietnam (SBV) to flexibly implement monetary and fiscal policies in order to control inflation and support economic growth.
Many commercial banks recorded higher credit growth compared to the overall target of 18 percent in 2015 such as HDBank with 20 percent, Vietinbank with 24 percent, Nam A Bank and VPBank with over 25 percent. According to SBV Deputy Governor Nguyen Thi Hong, together with positive developments of the Vietnamese economy, a credit growth target of 18-20 percent this year could be possible.
SBV’s credit growth directions this year will create favorable conditions for an increase in lending activities in a context where the real estate market is gradually warming. Dr. Tran Du Lich, a member of the National Advisory Council on Monetary and Financial Policies said that trade and production activities this year would be improved as interest rates would become more reasonable.
Promoting links between banks and enterprises
Nguyen Thi Hong said that credit would continue pouring into trade and production activities and priority sectors. The SBV will closely monitor market developments to timely adopt appropriate measures. They will also cooperate with ministries, agencies and localities to direct capital flows to high-demand sectors, especially programs linking banks and enterprises.
After nearly four years of implementation of programs on linking banks and enterprises, Ho Chi Minh City’s banking sector has lent 9,200 customers credit valued at over VND240 trillion.
In addition to trade and production activities and priority sectors, programs will focus on small and medium-sized enterprises in support industries. Some 17 commercial banks in Ho Chi Minh City have registered a credit package worth VND211.5 trillion and US$15 million with interest rates of under seven percent a year for short-term loans and 8-10 percent a year for medium and long-term loans to support those enterprises.
Deputy Minister of Industry and Trade Tran Tuan Anh said the SBV has promised to renew management, strengthen administration and improve financial mechanisms in order to facilitate using of credit sources.