Banks have been promoting the mobilisation of medium- and long-term capital through bond issuance to meet the State Bank of Vietnam (SBV)’s requirements on capital adequacy ratio (CAR).
Banks have to mobilise long-term capital at high costs by issuing certificates of deposit (CD) in Vietnamese dong with high interest rates to lure depositors, causing concerns about a domino effect on lending rates.
Only 30 per cent of small- and medium-sized enterprises (SMEs) have
access to bank loans while the rest have to use their own capital or
borrow from other sources at high interest rates.
