Business Business

02/10/2022 - 15:38

Ensuring healthy credit growth

That is what Mr. Pham Ba Nam, Director of the State Bank of Vietnam (SBV) - Provincial Branch, affirmed in the interview with Thua Thien Hue Weekly regarding the fact that the SBV had adjusted credit growth targets in 2022 for credit institutions (CIs).

Mr. Pham Ba Nam, Director of State Bank of Vietnam Thua Thien Hue Branch

According to Mr. Pham Ba Nam, the SBV has actively, flexibly and synchronously operated monetary policy tools, while at the same time implementing safe and effective credit management services to support economic recovery and growth in the first 8 months of 2022.

Among which, the SBV continued to keep the operating interest rates unchanged despite the sharp increase in world interest rates in order to facilitate CIs in accessing capital at low cost. Besides, it also directed credit institutions to concentrate capital for production and business sectors, together with priority areas, while at the same time strictly controlling credit for potential areas of risk.

In the context of being under great pressure from the sharp increase in world interest rates, the domestic lending interest rate level only slightly increased due to high credit demand to meet the recovery process.

Can you give more information about the credit growth in the province over the past few months?

By the end of August 2022, the total mobilized capital at credit institutions in the province reached VND 58,618 billion, seeing an increase of 5.4% as compared to that of the beginning of the year. The total credit balance also reached VND 71,608 billion, witnessing a rise of 13% in comparison to the figure of the beginning of the year (achieving nearly 93% of the plan), which was higher than the national growth rate and in line with the recovery trend of the provincial economy.

So, what specific activities have CIs in the province done to contribute to economic growth and best support customers in restoring and developing their manufacturing?

Adhering to the orientations, goals and solutions stated in Directive No. 01/CT-NHNN of the Governor of the SBV and Decision No. 01/QD-NHNN, the SBV – Provincial Branch has actively and proactively directed the CIs in the province to implement various solutions to support economic recovery and improve customers' access to credit. Among which, credit is directed to production and business sectors, which are prioritized by the Government, while at the same time strictly controlling credit for potential areas of risk.

Disbursement of the credit package under Resolution 11

CIs’ branches in the province have restructured the repayment term and kept the debt group unchanged until June 30th, 2022 (the end of the debt restructuring term) for 1,990 customers with a total debt value of VND 8,083 billion. Meanwhile, they also exempted or lowered interest rates for 52,752 customers with a total outstanding debt of VND 24,850 billion. The total amount of interest that has been exempted or lowered is VND 75.22 billion.

At the same time, from January 23rd, 2020, to June 30th, 2022, credit institutions actively made new loans to customers affected by the pandemic with a loan turnover of VND 42,547 billion.

The SBV continues to implement the policy of 50% reduction in transaction fees for payments via the interbank electronic payment system in accordance with Circular 13/2021/TT-NHNN (applicable from September 1st, 2021 to June 30th, 2022). At the same time, banks have drastically cut down, waived service fees, and implemented "Zero fee" programs (the policy of exempting banking transactions).

The policy of 2% interest rate support from the State budget through the commercial banking system has also achieved initial results when 3 customers in the province with a total outstanding loan of VND 2,107 million received interest rate support by August 31st, 2022.

In addition, the loan program to pay wages in case of work suspension and to pay salaries to restore production achieved a turnover of VND 1,809 million, and the number of employees paid was 547 employees.

Can you provide more specific information on the fact that the SBV has recently adjusted the credit growth targets in 2022 for CIs?

Based on the latest ranking results of each credit institution according to Circular 52/2018/TT-NHNN, the operation situation of CIs in 2022, market developments and criteria oriented since the beginning of the year in Directives 01, the SBV has adjusted the credit growth targets in 2022 for CIs with a request, and sent a notice to such institutions.

What do you think about these adjustments?

The adjustment of the credit growth targets in 2022 for CIs has demonstrated the timeliness and initiative of the SBV in credit management to support economic recovery and growth, yet still ensuring the target of inflation control.

What directions have been and will be given to CIs by the SBV to meet the capital demand in the last months of the year?

On the basis of the credit growth plan of 14% in 2022, the SBV – Provincial Branch continues to direct CIs to grow credit safely and effectively and concentrate credit for production and business sectors as well as priority areas according to the policy of the Government. At the same time, CIs are required to strictly control credit for potential areas of risk and facilitate individuals and businesses in accessing bank credit capital.

The SBV – Provincial Branch has directed commercial banks to actively implement the 2% interest rate support policy, promptly review arising problems to increase the disbursement progress of the program as well as implement preferential credit policies according to Decree No. 11/NQ-CP of the Government through the Bank for Social Policies. CIs will continue to promote digital transformation, apply science and technology, develop lending and payment services, simplify loan processes and procedures, and facilitate individuals and businesses in accessing credit capital with appropriate interest rates, contributing to limiting "usury".

What solutions should credit institutions take to accompany individuals and businesses in economic recovery and growth?

The banking industry in the province has adopted many solutions to accompany and share difficulties with individuals and businesses during the past time, especially when the development of COVID-19 pandemic was complicated.

In order to continue to support individuals and businesses during the period of economic recovery, the banking system in the province will carry on innovating and reforming credit granting procedures drastically, simplifying the banking processes and procedures to facilitate individuals and businesses in accessing banking services and loan sources quickly and easily in order to rapidly recover from the pandemic.

In particular, the banking system focuses on extending credit to manufacturing and priority areas according to the Government's policy, while, at the same time, strictly controlling credit quality, especially potential areas of risks.

Thank you, Sir!

Story & photos: Hoang Loan