In the first quarter of the year, the State Bank of Viet Nam reported that the sector’s volume of credit shrank by 1.96 per cent compared with the figure recorded at the end of last year. Meanwhile, the National Financial Supervisory Committee predicted that by mid-April, credit grew by only 0.25 per cent, much lower than the expected figure of 1.5 per cent per month. Despite the central bank’s efforts to cut interest rates to increase lending, banks continued to have negative credit growth and still recorded minus1.71 per cent growth by mid April. The banking sector has set a yearly target of achieving credit growth of 15-17 per cent in hopes of making a contribution to raising the country’s Gross Domestic Product (GDP) growth rate to between 6 per cent and 6.6 per cent this year. However, many independent experts said that even if banks achieved average credit growth rate of 2 per cent per month for the rest of the year, the entire banking sector’s credit growth would reach maximum 14 per cent. So the projected monthly credit growth rate of 2 per cent seemed to be unrealistic. Many banks that were given a credit-growth quota of 17… Read full this story
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