|1. CIM Co., LTD.|
Category: Industrial Supplies
City: Ha Noi
|2. DOCIMEX Corp.|
Category: Food Manufacturing
City: Cao Lanh, Dong Thap
|3. Dopetrad Corp.|
Category: Energy Suppliers
City: Bien Hoa
|4. Tien Phong Plastic JSC.|
City: Hai Phong
|5. Dai Thien Loc Corp.|
City: Binh Duong
|6. Nguyen Minh Steel Co.,...|
City: Ho Chi Minh
The ceiling deposit interest rate has been slashed to 12 percent per annum from 13 percent. However, as the production remains stagnant, the 15-17 percent credit growth rate may be unattainable.
15-17 percent a far-away goal
In the first quarter of 2012, the minus credit growth led to the dissolution of tens of thousands of businesses. The State Bank of Vietnam has lowered the ceiling interest rate in an effort to help ease businesses’ difficulties.
However, the efforts by the central bank seem to “fatten” commercial banks only, while they have not helped businesses escape from their difficulties. The capital flow has been moving around within the banking system or going to state owned enterprises, while capital has not pumped into the national economy which is in serious thirst for capital.
The State Bank of Vietnam has been urged many times to take more drastic measures to put the capital flow through, thus helping lift businesses’ difficulties.
Meanwhile, Governor of the State Bank of Vietnam Nguyen Van Binh keeps optimistic about the lending in 2012.
“The credit saw the positive growth rate of one percent in March 2012. With the average growth rate of 1.5-2 percent per month, the targeted credit growth rate of 15-17 percent by the end of the year proves to be within the reach,” Binh stated.
However, Vu Viet Ngoan, Chair of the National Finance Supervision Council, has pointed out that with the current status of enterprises and the national economic growth, it would be very difficult to obtain the 15-17 percent credit growth rate in 2012.
“The credit may grow by 5-6 percent at maximum in the second quarter of 2012, while the figure would not be able to reach 12-13 percent in the last six months of the year to raise the credit growth rate to 15-17 percent in the whole year as expected,” Ngoan said.
He has warned that if Vietnam still tries to push credit up too far, the national economy would have to pay a high price for this by early 2013.
Agreeing with Ngoan, Associate Professor Dr Dao Van Hung, Director of the Policy and Development Institute, a member of the National Advisory Council for Monetary Policies, also said that big difficulties would still exist until the end of June 2012, which would make unfeasible to obtain the credit growth rate of 2 percent every month.
Ngoan said that it is necessary for policy makers to anticipate the consequences to occur as a result of he low credit growth, and find out solutions to the problems. Loosening the fiscal policy is a suggested solution.
Other economists have voiced the same viewpoint that Vietnam does not necessarily obtain the credit growth rate of 17 percent this year, because it still needs to focus on fighting against the high inflation. However, they say, if Vietnam tightens credit, it needs to open other policies to ease enterprises’ difficulties.
Dr Vu Dinh Anh has emphasized that the problem now for Vietnam is not the lack of capital, but the capital jam. Therefore, it is necessary to find out the points of jams and apply reasonable policies to put the capital flow through.
Ngoan has denied the central bank’s report that only 6 percent of commercial banks have liquidity problem. “It is not true that the banks’ liquidity is not profuse. A part of banks still has weak liquidity. If the liquidity problem of the banks cannot be settled, the whole banking system would be influenced, and the interest rate reduction would not turn realistic,” Ngoan said.
|< Prev||Next >|
» Central Bank official quashes money change rumours
» Credit quotas make no more significance to banks
» Lower rates fail to impress
Latest Category Posts
- Developing countries to get bigger share of investments: World Bank
- Rates, risk keys to micro-finance
- Lending over 4 months up 2.1%
- Asset management body to be set up in bid to tackle debt
- Banking sector needs to embrace IT innovation
- Banks catch up with new technologies, services
- Deposit interest rates go down, where the money goes to then?
- Gov’t asks for reduction of interest rate gap
- Bank powers electricity project
- Viet Nam to gain from trade flow shift
Popular Category Posts
- SBV to stabilise gold prices
- 12 percent credit growth rate proves to be unattainable
- Vietnam considers loosening foreign currency management policy
- Central bank sends signal about exchange rate policy in 2013
- New credit limits ‘are likely'
- Cbank announces corrections on banking system data
- Gold market to have new big supply
- SBV trades non-SJC gold, commercial banks make fat profit
- Bad debt ratio decrease raises worry than joy
- Banks favour Government bonds
- Gold bidding mechanism not a miracle drug
- Credit institution investment rules to be tightened
- Ceiling interest rate reduction put banks in a stir and a jumble
- Banks see increase in outstanding loans
- Banks move ahead with M&A plans
- Growing CPI threatens share trade volumes
- In troubled times, banks find reason for slight optimism
- Banks provide loans to buy rice reserves
- Ministry outlines plan to develop bond market
- Central bank extends gold policy