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| Firms encouraged to borrow US dollar loans |
| 09/Mar/2010 Intellasia | Thoi Bao Kinh Te Sai Gon |
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| 9 Mar, 2010 - 1:40:16 PM |
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As the lending rate of dong is going up, many banks encouraged customers to borrow US dollar loans at lower rates. Some enterprises also opted for US dollar loans instead of dong loans.
Ly Xuan Hai, general director of Asia Commercial JS Bank (ACB) said that the banks raised the US dollar deposit rate to attract foreign currency and helped customers take US dollar loans at attractive interest rates. Currently, US dollar lending rate of commercial banks is common at 5.5-7 percent pa and even some offered the preferential rate of 3.5-4.5 percent pa to their traditional corporate customers.
Meanwhile, enterprises now have to pay 15-18 percent pa for dong loans (ceiling rate plus service fees).
Nguyen Quoc Sy, deputy general director of Western Bank said that some customers shifted to borrow US dollar because of lower lending rates however borrowers are mainly exporters because they have the turnover in US dollar. Import companies are very cautious in borrowing US dollar loans for the weak capacity in forecasting the forex rate movements and the bank unlikely has foreign currency sources to sell to these importers, Sy added.
Till late February, total deposits of HCM City based banks fell 0.45 percent from the year early because many enterprises use entire capital for production business investment while the mobilisation of dong deposits decreased by 1.3 percent and US dollar deposits up 1.77 percent. Lending dong loans in Jan-February also declined 0.35 percent while US dollar outstanding loans surged 2.48 percent, SBV-HCM City arm reported.
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