The credit growth last month rebounded compared to the first two months of this year when it was only 0.06 percent. (Photo vietnambiz.vn)Hanoi (VNS/VNA) - Despite being slow, credit growth of the bankingsystem in March recovered compared with the first two months of this year.
The State Bank of Vietnam (SBV) reported credit growth in the first quarter ofthis year reached 1.1 percent, slowing significantly against the 2.28 percentrate in the same period last year, due to adverse impacts of the COVID-19epidemic.
However, the credit growth last month rebounded compared with the first twomonths of this year, when it was only 0.06 percent, the lowest level in thepast six years.
Nguyen Quoc Hung, director of the SBV’s Credit Department, said compared withthe first two months of the year, the economy now has better access to credit.
The credit has begun to recover, Hung said, expecting that a higher growth ratewould be seen this week.
Besides State-owned banks, many private banks have recently offered creditpackages with preferential interest rates to support firms and individuals thathave been affected by the COVID-19 outbreak. The packages will last until thepandemic is over.
According to Hung, the banks’ move shows their liquidity is good and they areready to provide capital for the economy.
Vietnam Prosperity Commercial Joint Stock Bank (VPBank) has also launched thesecond special support package with interest rate decline of 2 percentagepoints, applicable to businesses facing difficulties due to the COVID-19pandemic.
Businesses entitled to these incentives must meet some requirements, such asoperating in tourism, catering, accommodation, and transportation areas; havingexport revenue of goods to markets such as China, the US, and the EU accountingfor at least 50 percent of the business revenue in 2019; or facing difficultiesin repaying debts.
Tien Phong Commercial Joint Stock Bank (TPBank) has recently issued a 12trillion VND preferential interest rate programme for new customers. Theinterest rate reduction of the loan is 1.5 - 2.5 percentage points per yearlower compared to the current interest rates.
Kien Long Commercial Joint Stock Bank (Kienlongbank) has decided to cut lendingrates by 3 percentage points per year for existing individual and corporatecustomers in the agricultural and fishery sectors. The time of the interestrate reduction is from April 1 to the end of June 30 this year, applicable to customersin the Mekong Delta region, especially in Kien Giang, Ben Tre, Ca Mau, TienGiang and Long An, who are heavily affected by drought and saline intrusion.
However, experts said banks must ensure efficiency and control risks of theloans, suggesting that firms wishing to receive preferential loans must provetheir business cash flow, input and output of their products as well as havingcollateral.
Enterprises in industries that still operate in spite of the COVID-19 pandemicsuch as electricity and consumer goods would get loans to sustain theirproduction and business, but those such as textiles, transportation and tourismshould be considered carefully in the current context, they said./.
VNA
