Major Vietnamese banks have asked the State Bank of Vietnam (SBV) to consider raising the cap on their credit growth so they could implement the central bank’s 2% interest rate support program for businesses.
The request was raised at a banking meeting the SBV organized on Friday to discuss the implementation of the business assistance program.
The support package of VND40 trillion (over $1.72 billion) from the state budget will kick off in the coming time for a number of businesses, cooperatives and business households. Areas expected to get assistance include aviation, warehouse transportation, tourism, accommodation services, manufacturing and processing industry, software publishing, computer programming, and information services.
Firms that need capital to build social housing projects, housing for workers, renovate old apartment buildings and other works listed by the Ministry of Construction would also benefit from the package.
Vietcombank Deputy CEO Nguyen Viet Cuong said in the first five months of the year, his bank's credit growth exceeded 9% while the whole year’s cap for the lender is only 15%. Therefore, the bank asked for a higher limit.
Executives of BIDV, VietinBank, and MBBank also claimed they need higher limits. Similarly, representatives of other banks said they have already used up to 60-70% of their caps, thus there is not much left for the rest of the year.
Responding, SBV Deputy Governor Dao Minh Tu said that the central bank has thought of higher limits for credit growth when working on the business support program, but SBV decisions must take inflation and macro-economic stability into consideration.
In the year to May 27, Vietnam’s banking system posted credit growth of 7.75%, doubling on the same period last year.
Despite this rapid growth, the SBV is of the view that there are many positive signs as credit supply has gone to many different fields rather than just a few.
Those sectors that have faced many difficulties during the pandemic period, like hotels and resorts, received higher-than-average credit supply, with growth higher than 8%. The increase in the transport, tourism and service sectors was 8.25%, while the rate in supporting industries was over 7.6%.