The State Audit of Viet Nam (SAV) has said the State Bank of Viet Nam's monetary policies ensured stable exchange rates and a liquid banking sector, in a report sent to the National Assembly this week.— Photo tygiavang

HA NOI (Biz Hub)— The State Audit of Viet Nam (SAV) has said the State Bank of Viet Nam's monetary policies ensured stable exchange rates and a liquid banking sector, in a report sent to the National Assembly this week.

In the report, SAV concludes that the management of interest rates in 2012 was considered more flexible with many downward adjustments helping to curb inflation at 6.81 per cent against the Government's target of 7-8 per cent.

However, other findings were varied with credit growth falling short of 2012 targets, holding at 8.85 per cent below a target range of 15-17 per cent. Meanwhile, total means of payment surged 22.4 per cent, far above the 14-15 per cent target.

SAV noted its auditing results on 59 credit institutions showed the non-performing loan ratio was also behind expectations, hitting 7.8 per cent by the end of last year compared with the 4.08 per cent ratio reported by 120 credit institutions.

In relation to the Viet Nam Development Bank (VDB), SAV indicated an imbalance between the source and use of funds that led to a significant stagnation of capital for the financial institution.

The bank's lending activities also faced a number of obstacles, including project inefficiency, large losses and insolvency. The bank also faced high bad-debt ratios for preferential credit programmes and encountered errors in accounting for management fees and compensation for interest rate gaps.

SAV plans to focus on assessing the financial health, management and performance of non-core investments from next year, with a particular focus on restructuring State-owned entities, commercial banks and credit institutions in line with growth models.

The move will underpin recommendations provided to the Government and National Assembly on restructuring State-owned enterprises and commercial banks, and bolstering supervision of the two sectors next year.

SAV will also audit this year's State budget and properties in 2014, in addition to assessing monetary policy implemented by the central bank.

Under SAV's plans, the Mekong Housing Bank (MHB)'s 2013 financial statements will be audited to reveal the bank's bad loans and investments in non-core businesses by the end of 2013 and June 30, 2014. — VNS