The State Bank of Vietnam, the country's central bank, has cut rediscount and refinancing rates by one percentage point to 5 per cent and 7 per cent/year, respectively, as part of a series of government efforts to boost lending.
The SBV also slashed the overnight rate of inter-bank market to 7 per cent from 8 per cent.
However, the central bank has kept the benchmark interest rate unchanged for April.
Banks and finance companies had made an additional of VND16.293 trillion in the week ended April 10, up 8.06 per cent from a week earlier, raising the total subsidized loans to VND218.424 trillion (approx US$13 billion) since it started the 4 per cent subsidized lending program in early February.
State-owned commercial banks and credit funds loaned VND162.256 trillion, up 7.44 per cent from a week earlier, commercial joint stock banks lent VND46.128 trillion, up 9.46 per cent, joint venture and 100 per cent foreign invested banks VND9.669 trillion, up 12 per cent, finance companies VND371 billion, up 6.91 per cent, it said.
The government has recently launched the second US$1 billion stimulus package by allowing banks to make low-cost loans until 2011.
First Deputy Prime Minister Nguyen Sinh Hung told Thomas Byrnes, an analyst and head of Moody's delegation early this month Vietnam has been shifting to economic growth with demand stimulus packages from fighting inflation with aims to maintain growth, generate jobs and ensure social security.
In the first quarter, total outstanding loans pumped by local banks and credit institutions soared only 2.67 per cent from end-2008, much lower than the set credit growth target of 21 per cent to 23 per cent for this year. (SBV, Local sources)
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