The foreign exchange rate between Vietnamese dong and the US dollar onNovember 17 rose to its highest level since June 30, hitting 21,380 VNDto the dollar amid soaring demand from enterprises near the end of theyear.
Sacombank sold US dollars at the highest price while othercommercial banks like Eximbank, Asia Commercial Bank (ACB), VietnamInternational Bank (VIB) and Bank for Investment and Development ofVietnam (BIDV) also had high rates, ranging from 21,290-21,320 VND forthe bid rate and 21,370-21,375 VND for the ask rate. The selling priceat Vietcombank was the lowest at 21,360 VND to the dollar.
Therate has risen since November 7 and gained 45-50 VND in just 10 days.The buy/sell rate on the black market has also climbed to 21,400-21,430VND.
Market insiders attributed the rise to increasing lending.Credit growth in the banking system expanded 8.63 percent as of the endof October, of which foreign currency lending made up a significantproportion with an impressive increase of over 20 percent. Lending isexpected to continue expanding in the last two months of the year due tohigh demand for raw materials and goods ahead of Tet.
VIBDeputy General Director Le Quang Trung told Dau Tu (Investment)newspaper that foreign currency lending had been growing due to stableforex policy and the large interest arbitrage between dong and thedollar.
Governor of the State Bank of Vietnam (SBV) Nguyen VanBinh promised early this year that the exchange rate between the twocurrencies would not increase more than 2 percent in 2014.
Accordingto analysts, most banks had abundant capital available for lending andthe pressure of completing profit targets was forcing them to expandlending, particularly in foreign currency.
Economist Le XuanNghia said strong growth of foreign currency loans was a good sign,indicating the expansion of import-export activities.
Respondingto worries about the rising forex rate, representative of the centralbank said supply and demand for foreign currency was balanced and undercontrol of the central bank.-VNA
Sacombank sold US dollars at the highest price while othercommercial banks like Eximbank, Asia Commercial Bank (ACB), VietnamInternational Bank (VIB) and Bank for Investment and Development ofVietnam (BIDV) also had high rates, ranging from 21,290-21,320 VND forthe bid rate and 21,370-21,375 VND for the ask rate. The selling priceat Vietcombank was the lowest at 21,360 VND to the dollar.
Therate has risen since November 7 and gained 45-50 VND in just 10 days.The buy/sell rate on the black market has also climbed to 21,400-21,430VND.
Market insiders attributed the rise to increasing lending.Credit growth in the banking system expanded 8.63 percent as of the endof October, of which foreign currency lending made up a significantproportion with an impressive increase of over 20 percent. Lending isexpected to continue expanding in the last two months of the year due tohigh demand for raw materials and goods ahead of Tet.
VIBDeputy General Director Le Quang Trung told Dau Tu (Investment)newspaper that foreign currency lending had been growing due to stableforex policy and the large interest arbitrage between dong and thedollar.
Governor of the State Bank of Vietnam (SBV) Nguyen VanBinh promised early this year that the exchange rate between the twocurrencies would not increase more than 2 percent in 2014.
Accordingto analysts, most banks had abundant capital available for lending andthe pressure of completing profit targets was forcing them to expandlending, particularly in foreign currency.
Economist Le XuanNghia said strong growth of foreign currency loans was a good sign,indicating the expansion of import-export activities.
Respondingto worries about the rising forex rate, representative of the centralbank said supply and demand for foreign currency was balanced and undercontrol of the central bank.-VNA
