HCMC – The banking sector in Vietnam is currently sitting on mountains of cash as the demand for loans in the economy remains woefully low, said Deputy Governor of the State Bank of Vietnam (SBV) Dao Minh Tu.
Tu was speaking at a meeting on ways to facilitate access to credit, chaired by Deputy Prime Minister Le Minh Khai on September 7.
Data from the SBV showed that as of August 29, total loans in the economy amounted to VND12.56 quadrillion, up 5.33% compared to late 2022.
There is still substantial room for credit growth, given the credit growth cap of 14% for this year. With credit expanding by 5.33% in the first eight months of this year, banks can still lend around VND1 quadrillion in the rest of 2023.
Therefore, the SBV affirmed that the lower-than-expected credit growth is not due to liquidity issues in the banking system.
The consolidated financial reports for the second quarter of 2023, provided by several commercial banks, indicated a significant surge in deposits, cash, and cash equivalents (CCE) against the same period last year.
For instance, Vietcombank mobilized nearly VND1.33 quadrillion in the first half of this year, an increase of VND83.3 trillion versus the end of 2022. The bank’s cash and cash equivalents amounted to VND325.5 trillion, which is over VND46 trillion higher than in the same period in the previous year.
Similarly, VietinBank attracted VND1.31 quadrillion in deposits during the first half of the year, which is VND60.8 trillion above the figure in the year-ago period. Furthermore, its cash and cash equivalents had totaled VND246.2 trillion as of the end of June.
Deputy Prime Minister Le Minh Khai tasked the SBV and relevant ministries with proactively seeking solutions to enhance access to loans for individuals and businesses.
The SBV has been urged to prioritize the improvement of capital absorption capabilities in key domestic industries and to implement effective measures aimed at reducing interest rates.
The SBV has also been directed to review all credit-related conditions, take into account reasonable recommendations, and make timely adjustments as needed. For the credit support packages that are still in effect, further efforts are needed to encourage loan disbursements.
