Business

Local banks continue to cut interest rates

The total outstanding loans of Vietnam-based credit institutions increased by 10.22 percent in the first 11 months of 2014 over that of end-2013.
The total outstanding loans of Vietnam-based credit institutionsincreased by 10.22 percent in the first 11 months of 2014 over that ofend-2013.

The State Bank of Viet Nam (SBV) also revealed onDecember 5 that lenders had actively reduced interest rates for existingdong loans.

Last November 16, loans with annual interest ratesof more than 15 percent accounted for 3.95 percent of all loans, whichwas less than the 6.3 percent recorded at the end of last year.

The ratio of loans with interest rates of more than 13 percent likewise fell from 19.72 percent to 11.1 percent.

TheSBV said it would continue to ask commercial banks to slash lendingrates further to below 13 percent. Interest rates declined by up to twoper cent this year and were backing production and business activitieswhile assuring national goals of controlling inflation and stabilisingthe monetary market.

Loans were focused onGovernment-prioritised areas and banking system liquidity remainedhealthy, with deposits at credit institutions expanding by 13.33 percentin 2014 over that of end-2013, it added.

Between now andyear-end, the SBV will closely monitor the market and ensurecomprehensive policies for monetary stability, especially on foreigncurrencies and exchange rates.

It will also provide furthersupport for businesses and speed up credit institution restructuring andbad debt resolution to ensure systematic security and enable an overalllending growth of 12 to 14 percent for 2014.-VNA
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