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Credit growth slow but sustainable
Wednesday,  Mar 14, 2018,22:46 (GMT+7)

Credit growth slow but sustainable

File photo of customers transacting with a domestic bank in HCMC. Though credit growth this year is below the same period last year, it is more sustainable - PHOTO: TL

HCMC – Though credit growth this year is below the same period last year, it is more sustainable, data of the National Financial Supervisory Commission showed.

A Thoi Bao Ngan Hang report quoted the commission as saying that credit, including lending and corporate bond purchases, picked up 0.9% in January and 1% last month against late last year, whereas the rate recorded in the same period of 2017 and 2016 was 1.6% and 0.8%.

Experts attributed the slower growth to slackened credit needs before and during the Lunar New Year holiday in February.

However, there has been a considerable improvement in credit quality, with medium and long-term credit falling to 53% compared to 55.2% in January 2017. Meanwhile, short-term credit accounts for 47%.

In addition, foreign currency credit has dropped to 8% from 8.4% in January 2017. Credit has been mainly funneled into production and priority areas as instructed by the Government and the central bank.

Latest data of the central bank’s credit department shows outstanding loans for agriculture and rural development were put at over VND1.31 trillion by December 31, 2017, up 25.5% year-on-year. They picked up 1.5% at the end of last January against end-2017.

Industry and construction saw outstanding loans soaring 22.38% year-on-year to over VND2.09 trillion at the end of last year, accounting for 32.15% of total outstanding loans in the economy. Outstanding loans of these areas edged up by 1.86% in late January.

As of January, combined outstanding loans in credit programs reached about VND171 trillion, down by VND791 billion against 2017.

Capital mobilization rose by 0.5% in January, down from 0.8% in January 2017 and 1.3% in January 2016, according to the commission.

Vietnam dong mobilization inched up 0.6% and made up 90.3% of total capital mobilization, whereas mobilization in foreign currency declined by 0.3% and accounted for 9.7%.

Liquidity in the banking system has been more abundant, supported by the central bank’s purchases of a large amount of foreign currency and supplies of some VND70 trillion in the first two months of the year.

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