Illustrative image (Source: VNA) Hanoi(VNA) – The State Bank of Vietnam (SBV) will keep a close watch on thedevelopments of the domestic and global economies to work out measures toensure stable exchange rate management in 2017, SBV Deputy Governor Nguyen ThiHong said at a press conference in Hanoi on January 4.
She added that theexchange rate and foreign exchange market in 2016 were quite stable despitepressure from unpredictable fluctuations in the global market.
Since the outsetof 2016, the SBV announced the flexible daily reference exchange rate followingthe developments of the domestic and overseas markets and monetary policytargets, which helped limit shocks from outside, reduce the storing of foreign currenciesand support the stabilisation of the exchange rate and foreign exchange market,she noted.
Deputy Director ofthe SBV’s Monetary Policy Department Nguyen Duc Long said the VND/USD exchangerate rose 1.2 percent compared to the 2016 beginning. At some periods, itincreased due to fluctuations in the global market such as Britain’s exit fromthe EU (Brexit), the US presidential election and Fed’s interest rate raising,but quickly re-stabilised after that.
Deputy ChiefInspector of the SBV’s Inspection and Supervision Agency Nguyen Van Hung said hisagency set a target of thoroughly handling banks with poor performance in 2017,including three banks bought by the SBV at zero namely Viet Nam ConstructionBank (VNCB), OceanBank and GPBank as well as DongABank and Sacombank.
According to theSBV, in 2016, the inspection of banking activities was strengthened andreformed, thus actively supporting the implementation of the monetary policy,restructuring and bad debt settlement.
Credit organisationswitnessed positive changes such as growth in capital mobilisation, assets andimproved financial capacity, while weak banks were strictly controlled andreshuffled.
As of November 30,2016, bad debts were estimated at 2.46 percent. The Vietnam Assess ManagementCompany (VAMC) acquired 839 debts with a total original balance of over 23.2trillion VND (1.1 billion USD) and a combined purchasing price of 22.4 trillionVND (1.06 billion USD).
According to Hong,the interest rates were kept stable in 2016. Some credit institutions decreasedlending interest rates to support business production.
The SBV usedflexibly tools to regulate liquidity and keep the inter-bank interest rate at alow level, thus facilitating the stabilisation of market interest rates.
The State bankalso directed credit organisations to take measures to balance capitals,stablise deposit interest rates, reduce costs and improve operationalefficiency, she said.
She added thatafter increasing by 0.2-0.3 percent per year in the first quarter of 2016, thedeposit interest rates became stable from the fourth month.
From lateSeptember, some credit institutions reduced deposit interest rates by 0.2-03percent and lending ones by 0.5-1 percent per year for business and productionand prioritised fields. The current lending interest rates stand at around 6-9percent per year for short terms and 9-11 percent for middle and long terms.
As of December 29last year, credit growth reached 18.71 percent. Total payment instruments andcapital mobisation increased by 17.88 percent and 18.38 percent respectively,significantly contributing to curbing inflation at 4.74 percent.
In 2017, thebanking sector targets a credit growth of 18 percent and total paymentinstruments of 16-18 percent.-VNA
VNA
