Vietnam Central Bank Prompts Banks to Cut Lending Rates

Nguyen Van Giau, governor of the State Bank of Vietnam, the country’s central bank, on October 28 requested local banks and credit organizations across Vietnam to report their outstanding loans with lending rates in an effort to push them to cut lending rates to support local businesses and economic sectors, the central bank said on its Website Oct 28.

 

Giau takes action after receiving feedbacks from a number of localities, business associations and businesses via the bank's hotlines that borrowing costs had been cut a little bit, and households and businesses have difficulties in borrowing bank loans.

 

The governor also urged heads of SBV's branches across the country to work with commercial banks to know the real situation.

 

Joint venture, joint stock and foreign-invested banks are asked to report their outstanding loans in dong with lending rates as of Oct 28 to the central bank within Oct 30.

 

Local banks report VND50 trillion of working capital and credit growth reached between 18 per cent and 19 per cent in Jan-Oct, and is forecast to be 26 per cent this year, Le xuan Nghia, head of SBV's Banking Development Strategy told a conference on assessing impacts of the global financial crisis in Ho Chi Minh City Oct 28.

 

Bad debts for the banking system are forecast to reach VND30 trillion this year, Nghia said. (SBV, ATPvietnam, Young People)