Vietnam's nine-month credit expands 13.4% to over $671 bln

Total outstanding loans in Vietnam stood at an estimated VND17,710 trillion ($671.21 billion) during Jan-Sept, up 13.37% from end-2024 and 4% higher than a year earlier, the State Bank of Vietnam (SBV) said on Friday.

About 78% of the credit was allocated to production and business activities, Pham Chi Quang, head of the SBV’s monetary policy department, told the press.

The central bank set this year’s credit growth quota at about 16% to support the government’s goal of expanding GDP by more than 8%. With the current pace, full-year credit growth could reach 19-20%, the highest in 15 years and above the plan, Quang said.

He added that the bank allocated the entire credit growth quota to lenders at the start of the year and published the rules for implementation. The target was revised in late July to accommodate stronger capital demand in the economy.

Quang highlighted the additional credit quota as a proactive move by the central bank, with lenders not required to file requests. The SBV also instructed banks to lend prudently and channel capital toward priority production and business sectors.

“We will continue to tightly control credit allocation to ensure funds go into production and business, while limiting disbursements to risk-prone areas such as real estate,” he said.

Ha Thu Giang, head of the SBV’s department of credit for economic sectors, said trade and services continued to account for the largest share of credit, at nearly 70%, followed by industry and construction (about 24%) and agriculture, forestry and fisheries (6.23%).

Credit to the real estate sector stood at about VND4,000 billion ($151.6 billion) in the first eight months, up 19% from a year earlier.

Under government-directed lending programs, the credit package for social housing and homebuyers under 35 was raised to VND145 trillion ($5.5 billion) from VND120 trillion late last year.

Nine banks including Agribank, Vietcombank, VietinBank, BIDV, TPBank, Techcombank, VPBank, MB, and HDBank are participating in the package. Disbursements have reached VND4.7 trillion ($178.13 million) so far, up 66% from the end of 2024.

From July through year-end, homebuyers under 35 can access social housing loans at an annual interest rate of 5.9%, down 0.2 percentage point from earlier. For the following 10 years, the rate will be set at 1 percentage point lower than the average medium- and long-term lending rates of Agribank, BIDV, Vietcombank and VietinBank - the four largest banks in Vietnam by total assets.

Speaking at the press meeting, SBV Deputy Governor Pham Thanh Ha said monetary policy operations have contributed significantly to GDP growth, with inflation well-contained and in line with targets, averaging 3.25% over eight months, while core inflation stood at 3.19%, below headline inflation.

For the final months of the year, Ha said the central bank will continue directing lenders to channel credit toward production and business, priority sectors, and key economic growth drivers.

It will tightly control lending to risk-prone areas while focusing financing on feasible major projects, green loans, and credit supporting regional and local strengths.

Additionally, the central bank will focus on implementing the decree on cashless payments and regulatory sandbox framework for banking, while continuing to advance the sector’s digital transformation plans, he said.

In 2024, Vietnam's credit growth reached 15.08%, with total credit balance of VND15,616 trillion ($591.85 billion) by the end of the year.