The State Bank of Vietnam (SBV) has said that the total outstanding loans for old loans still at the interest rate of above 15 percent per year accounted for 24.6 percent of the total loans.
Currently, the credit scale of the whole banking system is estimated at about 2,600 trillion dong. Till August 16, the total loans at the interest rate of above 15 percent per year at 69 credit institutions throughout the banking system accounted for 24.6 percent of the total loans, the central bank said.
Thus, the value of loans at the interest rate of higher than 15 percent per year is still at about 639.6 trillion dong. If comparing to before July 15, the volume has declined 65%. Of which, the strongest fall was seen in the group of five state-owned banks. This group’s total outstanding loan at the interest rate at above 15 percent per year accounted for only 6.2 percent of the total loans, down by 90 percent against before July 15.
In addition, the total loans in dong at the interest rate of less than 10 percent per year accounted for 4.1%, from 10-13 percent per year made up 20%. Meanwhile, loans at the interest rate of over 13 percent per year to 15 percent per year accounted for 51.3%, down by 65 percent from before mid-July and down 4.5 percent from August 3, 2012.
These 69 credit institutions include five state-owned commercial banks, 27 commercial joint stock banks and 25 branches of foreign banks together with 12 finance companies and financial leasing companies. These 69 institutions account for 90 percent of the credit market share of the whole network.
Earlier, at the preliminary meeting of the banking industry in the first six months of this year, the Governor Nguyen Van Binh asked commercial banks to cut interest rates on old loans to less than 15 percent a year from July 15. However, after one month of implementation, based on the financial ability and depending on the debt structure of each bank, so far not all 100 percent of older loans has been enjoying this preferential interest rate.
In a talk with the local Newswire VnExpress.net, financial specialist Vu Dinh Anh said that although highly appreciating the central bank’s policy to reduce the interest rate for old loans, it is necessary to review the target of this interest rate cut. “The businesses that are in trouble ought to have been given priorities in enjoying a lower interest rate but not the good objects” Anh said.