Experts discuss interest rate trends at an online meeting. (Photo: cafef.vn) Hanoi (VNA) - The central bank must push up bankingrestructuring and settlement of bad debt to ease pressure on rate hikes andkeep rates stable this year, experts agreed at an online meeting on March 28 on2017 interest rate trends.
Despite some pressure, the Government will strive to preventsignificant interest rate rises, the experts predicted in the wake of a recentdeposit interest rate rise on certificates of deposits by several banks, whichtriggered concerns.
Deputy director of the Institute of Economics and Finance, NguyenDuc Do, said "interest rates will not see significant increases this yearand even next year. Rate rises will have negative impacts on the economy andthe Government will not let this happen.”
In addition, Do said that the real interest rates in Vietnam wererelatively high and the central bank was giving priority to keeping themstable. “The interest rate trend will depend significantly on the way thecentral bank handles weak commercial banks,” Do said, adding that resolving baddebts must be sped up.
Financial expert Can Van Luc said that as the central bank pledgedto stabilise interest rates to create conditions for cutting lending rates, itmust be persistent on four measures.
These include speeding up the restructuring of weak banks and thehandling of non-performing loans, and implementing measures to raise capitalfrom citizens for business and production, together with controlling creditgrowth.
“Close monitoring of market developments, especially in the US andChina, is also necessary to respond accordingly,” Luc said. “Pay attention toinflation,” he added.
According to Nguyen Duc Hung Linh from the Sai Gon SecuritiesIncorporation, inflation, exchange rates and liquidity in the banking sectorwill have an impact on interest rates. “Inflation is not a significant worry atthe moment,” Linh said, adding that it was expected to grow 4-5 percent thisyear as fuel prices were not expected to rise significantly.
Exchange rates were expected to remain stable and the pressure foradjustment would not be very high, Linh said, adding that attention must bepaid to China’s yuan, however.
“The problem is how to ensure liquidity. Currently, there is animbalance in terms of deposits and credits,” Linh said. In 2017, the centralbank should adopt measures to ensure a positive overall balance of payments.
The central bank on March 27 confirmed that the liquidity of thebanking system remained good and interest rates were stable.-VNA
Despite some pressure, the Government will strive to preventsignificant interest rate rises, the experts predicted in the wake of a recentdeposit interest rate rise on certificates of deposits by several banks, whichtriggered concerns.
Deputy director of the Institute of Economics and Finance, NguyenDuc Do, said "interest rates will not see significant increases this yearand even next year. Rate rises will have negative impacts on the economy andthe Government will not let this happen.”
In addition, Do said that the real interest rates in Vietnam wererelatively high and the central bank was giving priority to keeping themstable. “The interest rate trend will depend significantly on the way thecentral bank handles weak commercial banks,” Do said, adding that resolving baddebts must be sped up.
Financial expert Can Van Luc said that as the central bank pledgedto stabilise interest rates to create conditions for cutting lending rates, itmust be persistent on four measures.
These include speeding up the restructuring of weak banks and thehandling of non-performing loans, and implementing measures to raise capitalfrom citizens for business and production, together with controlling creditgrowth.
“Close monitoring of market developments, especially in the US andChina, is also necessary to respond accordingly,” Luc said. “Pay attention toinflation,” he added.
According to Nguyen Duc Hung Linh from the Sai Gon SecuritiesIncorporation, inflation, exchange rates and liquidity in the banking sectorwill have an impact on interest rates. “Inflation is not a significant worry atthe moment,” Linh said, adding that it was expected to grow 4-5 percent thisyear as fuel prices were not expected to rise significantly.
Exchange rates were expected to remain stable and the pressure foradjustment would not be very high, Linh said, adding that attention must bepaid to China’s yuan, however.
“The problem is how to ensure liquidity. Currently, there is animbalance in terms of deposits and credits,” Linh said. In 2017, the centralbank should adopt measures to ensure a positive overall balance of payments.
The central bank on March 27 confirmed that the liquidity of thebanking system remained good and interest rates were stable.-VNA
VNA
