'Widening credit room' by 1.5-2% for the credit institution system
On the evening of December 5, the State Bank of Vietnam announced that it had decided to adjust the 2022 credit target by about 1.5-2% (loosening room) for the entire system of credit institutions.
According to the State Bank of Vietnam (SBV), the principle of adjusting credit targets for credit institutions is that credit institutions with better liquidity and lower interest rates will have higher credit growth.
The Governor of the State Bank of Vietnam requested credit institutions to balance appropriate capital for credit provision, focusing capital on production and business sectors, especially priority sectors such as agriculture, rural areas, exports, small and medium enterprises, supporting industries, etc., growth drivers in accordance with the policies of the Government and the Prime Minister.
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State Bank Headquarters. |
The State Bank of Vietnam affirmed that credit expansion must go hand in hand with term risk control to ensure liquidity, operational safety, and payment capacity for businesses and people, especially during the Lunar New Year.
The Governor also requested the State Bank to closely monitor the situation and have solutions to support liquidity in a timely manner through various channels. If necessary, support with longer terms, including extending the term beyond Tet, so that credit institutions can feel more secure when granting credit.
These are flexible solutions in the current situation. At the same time, in the coming time, the State Bank will closely follow forecasts and situations, especially inflation developments, to develop orientation targets and solutions for monetary and credit management in 2023.
Previously, speaking at a meeting with key leaders of Bac Lieu province on the afternoon of December 4, Prime Minister Pham Minh Chinh directed: The State Bank of Vietnam to review and classify enterprises and credit institutions that operate effectively, healthily, safely, and sustainably, research and immediately implement appropriate and effective credit limit increases to control inflation, promote growth, create jobs, focus on three growth drivers: consumption, investment, export, and support businesses in difficult times.
According to the macroeconomic outlook and investment strategy report of VNDirect Securities Corporation, banking system credit increased by 16.5% year-on-year and 11.5% year-on-year, as of the end of October 2022, higher than the growth rate in the same period last year (up 8.8% year-on-year). However, credit only increased by about 2% from the end of June to the end of October (increased by 9.44% year-on-year in the first 6 months of 2022), showing that credit growth has slowed down significantly as controlling inflation and stabilizing the macro economy remains the Government's top priority for the remainder of 2022./.
