Credit expanded at 5.1 per cent as of June 15, a good growth rate in the pandemic. — Photo zingnews.vn
With credit expanding quickly in the first half of this year, the State Bank of Viet Nam (SBV) said in its press conference on Monday that the credit growth target for the full year of 2021 at 12 per cent was within reach and it might consider extending credit room if necessary.
SBV’s statistics showed that despite the pandemic, credit growth reached 5.1 per cent as of mid-June against the end of 2020, more than doubling the rate of 2.26 recorded in the same period last year.
This meant that banks pumped a net value of VND468.8 trillion (US$20.2 billion) into the economy in the first six months of this year through lending.
Deputy Governor Dao Minh Tu said that the central bank always asked credit institutions to focus on providing capital for production and prioritised sectors while tightly controlling credit flow into risky sectors.
At the same time, banks were asked to remove difficulties in credit access and creating favourable conditions for enterprises and citizens to borrow money from banks.
“With such strong credit growth in the first half of this year, the credit growth target for the full year which was set at 12 per cent was achievable,” Tu said. “If the pandemic is put under better control, the central bank might consider to extend credit room.”
Tu stressed that the central bank maintained a flexible monetary policy and ensured the system liquidity to stabilise the market and promote economic recovery amid the pandemic.
As of June 15, M2 money supply increased by 3.96 per cent against the end of 2020 and 14.27 per cent against the same period last year.
The liquidity of the credit institutions system was abundant and stable, Tu said.
Tu said the interest rates were generally kept at low levels in the first half of this year after three cuts in 2020. This aimed to reduce lending costs for citizens, enterprises and the economy.
As of April, annual deposit and lending rates were around 0.3 percentage points lower than the end of 2020. The maximum short-term lending rates of loans in Vietnamese dong for prioritised sectors was around 4.5 per cent per year while lending rate for USD averaged 3-6 per cent per year.
Regarding the support to enterprises and citizens who were affected by the COVID-19 pandemic, the central bank’s statistics showed that credit institutions have so far restructured debt payment deadlines for more than 257,600 customers with a total outstanding loan balance of more than VND336.66 trillion, reduced rates for more than 676,690 customers with a outstanding loan worth more than 1.2 quadrillion. New loans with low lending rates provided from January 23 to date were worth more than VND3.5 quadrillion.
Cashless payment also saw good growth. Online transactions rose by 65.9 per cent in volume and 31.2 per cent in value in the first four months of this year compared to the same period last year, via mobile by 86.3 per cent and 123.1 per cent, via QR Code by 95.7 per cent and 181.5 per cent, respectively.
Support for Vietnam Airlines
At the press conference, Nguyen Tuan Anh, Director of the SBV’s Credit Department, said that regarding the support to national carrier Vietnam Airlines which was hit hard by the pandemic, three credit institutions, including SeaBank, Vietnam Maritime Commercial Joint Stock Bank, and Sai Gon – Ha Noi Commercial Joint Stock Bank pledged to provided Vietnam Airlines with a total loan worth VND4 trillion from the refinancing source of the SBV.
Credit institutions and Vietnam Airlines were working on the credit agreements for disbursement of the capital which was expected to start at the end of this month.
Recently, Dang Anh Tuan, head of Vietnam Airlines’ Communications and Branding Department, also said that the procedures for the credit package worth VND4 trillion were being completed to support the national carrier to overcome the difficult period.
A recent report by the Ministry of Planning and Investment showed that Vietnam Airlines expected a loss of VND10 trillion in the first half of this year. Overdue debts of Vietnam Airlines reached VND6.2 trillion.
According to audited 2020 financial report of Vietnam Airlines, the national carrier had short-term loans without mortgage assets worth nearly VND6.8 trillion and nearly VND9 trillion of long-term loans. — VNS