Banks Actively Support Businesses

The Tien Giang Branch of the State Bank of Vietnam (SBV) said Tien Giang province now has 22 commercial banks, and two policy banks (Vietnam Bank for Social Policy and Vietnam Development Bank). All banks have flexible products and services to meet a wide range of customer demands. The application of modern information technology helps shorten transaction time and payment periods.

 

Banks have also installed more than 130 ATMs to support the expansion of salary payment into bank accounts, and the settlement of telephone, electricity and water bills. They also have over 140 POS installed at restaurants, hotels, supermarkets and shopping centres to support noncash payment.

 

Tien Giang province is expected to have three new bank branches in the coming time and the SBV - Tien Giang actively supports the operating expansion of commercial banks, especially in populous localities.

 

Recently, businesses have encountered mounting difficulties resulting from economic crisis and narrowed access to loans for production and business activities. In this context, the banking industry has made positive moves to help businesses get rid of temporary difficulties. Mr Vo Thanh Nha, Director of SBV - Tien Giang Branch, said the SBV has directed banks to lower lending rates to support businesses. The SBV’s Circular 14 is an important milestone to rescue businesses.

 

Particularly, in May 2012, outstanding loans bearing the interest rates of 15 percent per annum downwards accounted for 19 percent of total loans outstanding, from 12.72 percent in April. Outstanding loans with interest rates from 18 - 20 percent per annum and over 20 percent per annum fell 14.97 percent and 3.29 percent from April, respectively.

 

The above results proved that banks have actively lowered lending rates to support businesses. They also rescheduled repayment periods, restructured debts and reduced interest rates for troubled businesses with good corporate profiles. In May 2012, they rescheduled payment terms and rebated rates for 100,000 corporate and personal borrowers indebted VND2,500 billion.

 

Currently, corporate loans in the province account for nearly 50 percent of total outstanding loans. “The goal of the banking sector is supporting businesses to develop as banking activities are only effective enough when businesses thrive. Hence, in both short and long terms, the banking sector is actively funding good-performing enterprises,” Mr Nha said.

 

In addition to supporting business, banks are ready to borrow to sub-lend good-performing businesses regardless of ownership models. In the coming time, the banking industry will continue giving priority to agriculture, countryside, small and medium-sized enterprises, exporters, and supporting industries.

 

Nha said local banks will strive to keep deposit growth of 18 percent a year, keep credit growth at 10 percent onwards, and control bad debts at 3 percent of outstanding loans. The SBV - Tien Giang Branch will inspect banks, manage gold and foreign currency trading, and encourage noncash payment activities.