While the inspection over post-promotion real lending rate and negotiated lending rates is going on, the State Bank of Vietnam (SBV) yesterday March 18 confirmed that it would carry out first inspections on capital mobilisation of commercial banks.
Accordingly, the inspection will be conducted on credit institutions that have a ratio of deposits from the interbank market (market 1) higher over 20 percent than deposits from the market 1 (deposits of residents and economic institutions).
Under current regulations, SBV banned commercial banks to take capital from the interbank market to lend residents and economic institutions.
The announcement on inspections was made from February 2010. With this, SBV will continue correcting the business operations on the interbank market because in theory, the capital of interbank market is only used to increase liquidity and offset the compulsory reserve of commercial banks, not for capital business.
Meanwhile, the difficulties in capital mobilisation of credit intuitions have not been treated. In first two months of 2010, total deposits of banks fell 0.17 percent against late 2009, because the deposits of economic institutions plunged by 5.94 percent. On contrary, the credit institutions’ total outstanding loans surged 1.4 percent and tended to rise.
The big gap in capital mobilisation between two markets (market 1 and 2) will push commercial banks into liquidity shortage. Some bankers proposed, SBV should allow commercial banks to be flexible in using capital of interbank market to balance working capital.
In last few weeks, the trading turnover of the dong according to SBV’s statistics soared from 67 trillion dong to 85-87 trillion dong. Previously, the overnight trade of the dong on interbank market used to account for 30-35 percent of total full-week trading turnover.
In March, banks will be busy with a series of report, checks and inspections relating to capital mobilisation as well as lending.