Credit growth of Vietnam's banking system reached 1.31 percent from January to May 23.
"Thissituation is partially due to seasonal factors. Credit demand in thefirst half of the year is normally low," Head of the Monetary PolicyDepartment under the State Bank of Vietnam (SBV) Nguyen Thi Hongannounced at the monthly press meeting on May.
Hong stated thatas the system had an abundant capital source, coupled with lowerborrowing costs, credit demand will surge in the latter part of theyear.
"The entire target of credit growth [12-14 percent] will be probably achieved," she added.
Inthe first five months, the total supply was an estimated 5.28 percenthigher than the end of last year. Meanwhile, the total mobilised capitalincreased by 4.2 percent.
In May, borrowing costs were trimmedby 0.5 percentage point while deposit interest rates were lowered by0.5-1.5 percentage points against 2013. Loans for privileged sectorsenjoyed 1 percent cut interest rate.
Responding to questionsabout the possibility of a lower interest rate towards the year-end,Hong stated that it should depend on the actual movements of the economyand inflation. If inflation continues its downtrend, lenders may cutadditional 0.5 percentage point.
Chief Inspector of the SBVNguyen Huu Nghia stated that in the first five months, Vietnam AssetsManagement Company (VAMC) had bought additional 6.3 trillion VND (298.58million USD) that raised the total purchased debts to 45.63 trillionVND (2.16 billion USD).
Earlier this year, VAMC had planned tobuy 10 trillion VND (474 million USD) in the first quarter. Nghiapointed out that this was because of slow policymaking procedures,allowing VAMC to issue special bonds.
To date, creditinstitutions have submitted applications to sell over 30 trillion VND(1.42 billion USD) to VAMC. VAMC is planning to raise the totalpurchased debts to 70-100 trillion VND (3.32-4.74 billion USD) by theyear end.-VNA
"Thissituation is partially due to seasonal factors. Credit demand in thefirst half of the year is normally low," Head of the Monetary PolicyDepartment under the State Bank of Vietnam (SBV) Nguyen Thi Hongannounced at the monthly press meeting on May.
Hong stated thatas the system had an abundant capital source, coupled with lowerborrowing costs, credit demand will surge in the latter part of theyear.
"The entire target of credit growth [12-14 percent] will be probably achieved," she added.
Inthe first five months, the total supply was an estimated 5.28 percenthigher than the end of last year. Meanwhile, the total mobilised capitalincreased by 4.2 percent.
In May, borrowing costs were trimmedby 0.5 percentage point while deposit interest rates were lowered by0.5-1.5 percentage points against 2013. Loans for privileged sectorsenjoyed 1 percent cut interest rate.
Responding to questionsabout the possibility of a lower interest rate towards the year-end,Hong stated that it should depend on the actual movements of the economyand inflation. If inflation continues its downtrend, lenders may cutadditional 0.5 percentage point.
Chief Inspector of the SBVNguyen Huu Nghia stated that in the first five months, Vietnam AssetsManagement Company (VAMC) had bought additional 6.3 trillion VND (298.58million USD) that raised the total purchased debts to 45.63 trillionVND (2.16 billion USD).
Earlier this year, VAMC had planned tobuy 10 trillion VND (474 million USD) in the first quarter. Nghiapointed out that this was because of slow policymaking procedures,allowing VAMC to issue special bonds.
To date, creditinstitutions have submitted applications to sell over 30 trillion VND(1.42 billion USD) to VAMC. VAMC is planning to raise the totalpurchased debts to 70-100 trillion VND (3.32-4.74 billion USD) by theyear end.-VNA
