11:10:41 AM | 3/10/2008
Nguyen Van Giau, governor of the State Bank of Vietnam, the country’s central bank, on September 30 told a press conference that the banking system of Vietnam will not be impacted from the financial crisis in the U.S. as the country’s forex reserves hit more than US$22 billion and liquidity surplus of local banks is estimated at VND40 trillion (US$2.424 billion).
Forex reserves of Vietnam have been added with US$1.6 billion, up from US$20.7 billion in 2007, and more than 80 per cent of the reserves are being kept at central banks of the U.S., France, Germany, IMF and other prestigious international credit institutions, and the remainder is held in foreign commercial banks with ratings of AAA and AA, Mr Giau noted.
“At this moment, the U.S. financial crisis has no impacts on Vietnam’s banking system, their assets are safe,” Giau said.
“SBV is keeping a close watch on operations of local banks and continuing to intervene to stabilize the forex market to ensure liquidity of the banking system and the whole economy,” Mr Giau emphasized.
SBV will continue to tighten monetary policies, but will be flexible in management and will keep close eyes on developments of the global financial market and operations of local banks from now till the end of the year, Giau added.
Liquidity surplus of local banks estimated at VND15 trillion-VND30 trillion, even at peak of VND40 trillion after SBV has recently decided to increase interest rates of compulsory reserves to 5 per cent has helped push down inter-bank rates to 12 per cent for one week term and below 10 per cent in the coming months. In the first nine months this year, commercial banks saw deposits rise by 11.01 per cent with dong deposits soaring 28.5 per cent on year and hard currencies jumping 35 per cent, which are encouraging signals, Giau said.
Between Jan and Sept, Vietnam’s loans growth has expanded 19.15 per cent so far, and outstanding loans for the local real estate market were VND115 trillion, accounting for 9.15 per cent of the total loans, Giau said.
Meanwhile, Ngo Tri Long, former dean of the Ministry of Finance’s Price and Market Research Institute told reporter of the An Ninh Thu Do (Capital Security) newspaper that if the U.S. Congress does not approve the US$700 billion bailout plan, the U.S.’s economy will continue on the way of crisis. The crisis will not have direct impacts on Vietnam, but directly because the U.S. imports a fifth of Vietnam’s exports value.
Mr Long also proposed to loosen a little bit the monetary policies by lowering base rates marginally because 70 per cent of local companies base on bank loans for their business operations.
Minister Nguyen Xuan Phuc, head of the Government Office forecast that consumer prices will ink up 0.2 per cent on month in Oct this year, up from 0.18 per cent in Sept. (VNA, Youth)
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