A series of banks surpass the credit ceiling

20-Oct-2020 Intellasia | Vietnam Finance | 6:02 AM Print This Post

The State Audit said that seven banks with credit growth exceeded the State Bank of Vietnam (SBV)’s acceptable level. These were Vietnam Public Joint-stock Commercial Bank (PVcomBank) with 13.656 trillion dong, Sai Gon Joint Stock Commercial Bank (SCB) with 8.654 trillion dong, Bao Viet Joint Stock Commercial Bank (BaoVietBank) with 3.153 trillion dong, Shinhan Bank (South Korea) with 132 billion dong, Mizuho Bank Hochiminh Branch with 192 billion dong, Busan Bank Hochiminh branch with 83 billion dong, Vietnam Russia Joint Venture Bank with 69 billion dong.

According to SBV, as of September 30, 2020, credit growth was 6.09 percent compared to the end of 2019. In the economic sector, the outstanding loans trade and service accounted for a large proportion of 63%, had the highest credit growth of about 6.32%. The construction industry’s outstanding loan was estimated to increase by 5.89%, accounting for 28.75%. The credit for the agriculture, forestry and fisheries sector accounted for 8.66%, estimated to rise by 5.09%.

Regarding credit for priority sectors, some priority areas would continue to be focused under the direction of the government, especially some areas that were taking advantage of the new context, such as export with credit at about seven percent. The credit for agriculture and rural areas increased by five percent, credit for small and medium enterprises increased by about 5.5%.

In early October, SBV reduced the ceiling interest rate for the third time in a related development. Specifically, the maximum interest rate applicable to demand deposits and terms for less than one month was 0.2 percent per year. The maximum interest rate applicable to deposits with terms from one month to less than six months decreased from 4.25 percent per year to 4 percent per year.

SBV also reduced the refinancing rate from 4.5 percent per year to 4 percent per year. The rediscount interest rate also dropped from three percent per year to 2.5 percent per year. The overnight lending interest rate in interbank electronic payments and loans to offset the shortage of capital in clearing payments of SBV for banks decreased from 5.5 percent per year to five percent per year. The interest rate offered to buy valuable papers through the open market operation fell from three percent per year to 2.5 percent per year.

 

Category: Finance, Vietnam

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