Total deposits in Jan-Jun surge 7.83pct: Govt

The Vietnamese government’s report at the regular cabinet meeting on late July 3 stated that in comparison with December 31, 2011, the total money supply (M2) in the first six months of this year is estimated to have increased 6.84 percent (in May, the rise was 4.47%) and the total deposits of customers at credit institutions soared 7.83 percent (in May, the rise was 5.42%).

This indicated that the liquidity of the entire banking system is getting better and the total outstanding loans of the economy have grown steadily again, forex rate has been stable and balance of payment has been improved.

However, the banking system still faces many difficulties and challenges such as the capital flows for the economy still have obstacles and bad debt situation at banks still remained unresolved.

Earlier the Governor Nguyen Van Binh told the National Assembly that bad debts at Vietnamese banks are equal to 10 percent of GDP.

Although the total money supply and total deposits increased significantly, the total outstanding loans in Jan-Jun were still low.

Despite falling lending interest rates, it is still high, exceeding the enterprises’ reach.

Facing this situation, the government asked the State Bank of Vietnam (SBV) to have drastic measures to deal with bad loans, regulate the interest rates in accordance with targeted inflation (7-8%) and quickly remove obstacles of money inflows for enterprises.

The central bank was asked to regulate the money supply (M2) and reasonable credit growth rate to ensure economic growth and inflation control target both.

 

Category: Finance