Saturday, 28/12/2024
   

Central bank demands lending rate cuts, growth target to be met

The State Bank of Vietnam (SBV) has demanded credit institutions deliver a system-wide credit growth target of 5-6 per cent by the end of the second quarter this year, and reduce lending rates by 1-2 per cent, it said on Friday.
Central bank demands lending rate cuts, growth target to be met
SBV headquarters

The SBV has outlined several measures to address current issues related to credit and interest rates, including simplified loan procedures, cost-saving measures and stronger applications of IT and digital technology

The central bank aims to cut lending rates by 1-2 per cent, with a focus on supporting economic recovery and growth drivers, emerging sectors, green transitions, circular economy and social housing.

It’s also part of an effort to grant easier access to financial solutions and credit, in line with a decision approved by the government and the Prime Minister.

The decision requires credit institutions across the country to maintain a stable, reasonably adjusted deposit interest rate that improves capital balance, credit expansion and risk management and promotes stability in the monetary market.

The central bank stressed the importance of implementing effective and targeted credit growth solutions to meet the economy’s demand, especially key industries that act as main growth drivers. Credit institutions were told to increase scrutiny in credit control in potentially high-risk businesses to ensure the system’s safety and operation.

Projects should be reviewed and studied carefully so that loans can be approved promptly with a flexible approach to collateral policy. The central bank also asked credit institutions to offer additional financial and credit packages to better meet the demands of different customer segments.

In addition, the SBV told credit institutions to proactively inform customers about their policies, products and services in a transparent and detailed manner. The central bank demanded credit institutions' active participation in bank-to-businesses programmes, in coordination with local governments and agencies, to support businesses in solving numerous difficulties and challenges they have been facing in recent years.

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