Lending to Securities Traders Remains Low: SBV
Total loans to securities investors are estimated between VND1.5 and 1.6 trillion ($93.8 million), accounting for only 2 per cent of the total outstanding loans of the whole banking system, said Le Duc Thuy, governor of the State Bank of Vietnam (SBV).
Thuy said during a recent meeting with the press that the proportion of loans for securities trading deals remained low and this would not have any serious impact on the banking system if something bad happened.
However, it is more risky to loan for securities trading than to fund other kinds of business, he said.
The SBV has many times asked commercial banks to be cautious about lending to securities traders.
Commercial banks have the right to give loans mortgaged by securities and to assess mortgaged assets to decide how much to lend. However, they must be careful because securities values fluctuate all the time.
At present, local banks have just given loans of a value much lower than the mortgaged shares, Thuy said.
Under new regulations to be enacted in January, commercial banks will not be allowed to fund securities trading deals of securities companies belonging to the banks. Commercial banks have the right to lend to securities companies that do not belong to the banks, but the loans must be mortgaged with assets.
(VietNamNet)
Vietnamese
