Vietnam’s Credit Growth Quickens to 13.5% in 10 Months, Consumer Lending Soars

Tuan Minh

16:18 10/11/2017

BizLIVE - The credit growth rate is far from meeting the government's target of 21% set for this year.

Vietnam’s Credit Growth Quickens to 13.5% in 10 Months, Consumer Lending Soars

The head office of the State Bank of Vietnam. Photo: Minh Tuan/BizLIVE

Total credit of the Vietnamese banking system expanded 13.5% in the ten months through October, speeding up from a 12.16% increase in the first nine months of this year, the National Financial Supervisory Commission has said in a monthly report.
Medium- and long-term loans accounted for 53.7% of total lending, sliding from 55.1% at the end of 2016, while shorter terms loans made up the remaining 46.3%, compared to 44.9% 10 months earlier.
Notably, lending in foreign currency picked up 11.5% in the 10-month period, higher than an increase of 4.4% in the same period last year, buoyed by larger imports.
The weight of lending for real estate has now dropped to 15.5% of total credit, from 17.1% in 2016, according to the report.
Meanwhile, consumer lending soared 58.6% between January and October, “in line with the uptrend of consumption in the economy,” the report added.
The commission said that capital mobilization grew by an estimated 12% from end-2016, lower than a 14.7% expansion in the same period last year.
It noted that bank liquidity remained stable at low levels in October, evidenced by interbank interest rates sliding 20 basis points from the previous month. Rates of overnight, one-week and one-month loans were 0.9%, 0.9% and 1.5% per year, respectively.
The system’s liquidity was supported by the Vietnamese central bank net pumping around 130 trillion dong ($5.72 billion) since the start of the year.
The government has recently revised up the credit growth target for this year to 21-22% from the initial 17%.

TUAN MINH

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