16.07.2021, 11:49

Several banks give greenlight to raising credit limits

Several banks give greenlight to raising credit limits

Some banks are now allowed to have their credit growth rates of up to 14-15%.   

NDO - The State Bank of Vietnam (SBV) has permitted several commercial banks to increase their credit limits in the final months of 2021 to boost economic growth.

Credit growth was previously capped at 10-12%, but now some lenders are allowed to have their loans rise by up to 14-15%.

In its approval document, the SBV asked credit to be concentrated on production sectors, including agriculture, small and medium-sized supporting industries, and companies employing advanced technology.

Commercial banks are also required to restrict lending to risky sectors, such as property and securities.

Previously at a meeting of the Vietnam Banks Association on lowering interest rates for pandemic-hit customers, several banks had proposed that they be allowed to increase their credit limits.

For instance, Vietcombank’s credit growth limit was capped at 10% but the lender’s loans have now increased by 9%. As such, Vietcombank suggested having its limit increased so that it can continue supporting its customers.

Head of the SBV’s monetary policy Pham Thanh Ha said that, based on banks’ proposals, the central bank will conduct assessments and adjust the limit appropriately for each bank.

At the start of 2021, the central banks set the credit growth target at 12% but Ha stated that, as the pandemic is being curbed around the world and the economy needs further funds for recovery and growth, the SBV will increase the credit limit.