Banks lending big to keep agriculture sector ticking

According to the State Bank of Vietnam’s department of credit for economic sectors, as of April credit injected into rural and agricultural development had reached 2.3 quadrillion VND (100 billion USD), or 24.6 percent of the banking sector’s total loans.

Banks lending big to keep agriculture sector ticking hinh anh 1

Banks have prioritised agricultural projects that are involved in value chains and adopt high technologies for lending. (Photo courtesy of Agribank)

According to the State Bank of Vietnam’s department of credit for economic sectors, as of April credit injected into rural and agricultural development had reached 2.3 quadrillion VND (100 billion USD), or 24.6 percent of the banking sector’s total loans.

Banks have prioritised agricultural projects that are involved in value chains and adopt high technologies for lending.

Analysts said loans given to such projects are worth hundreds of thousands of billions, mainly by State-owned lenders.

Agribank leads in this regard, providing credit to 29 hi-tech agricultural parks licensed by the Government and 20 technology-based farm companies.

The state-owned bank has also lent thousands of billions of dong to companies and farms in value chains to expand production.

Vietcombank is another major lender to the agricultural sector

For instance, this state-owned bank has lent 550 billion VND (24 million USD) to the Dabaco Group, which specialises in identifying and restoring domestic chicken breeds and runs research centres having a modern, closed circle using advanced AI technology, 575 billion VND for Hoa Phat Group’s agricultural project and 46 billion VND to the Da Lat Flower Forest Biotechnology Corporation.

Another State-owned bank, BIDV, has lent thousands of billions of dong to agricultural companies’ value chains.

Among the beneficiaries are Hoang Anh Gia Lai Agricultural Joint Stock Company, which grows orchards (721 billion VND) and the Agricultural Technology Joint Stock Company (11.3 billion VND).

Analysts said banks keen to lend to enterprises in agricultural value chains this is because it has enabled them to reduce risks thanks to effective cash flow management.

Though the risk of bad debts is not completely eliminated, non-performing loans in this area are quite low, they said.

Moreover, Government policies require them to support the development of the agricultural sector, they pointed out.

Dr Can Van Luc, a member of the National Monetary and Financial Advisory Council, said developing hi-tech agriculture is an inevitable trend since it has created a new impetus for the sector amid the context of climate change, industry 4.0 and international integration.

To sustain this, the Government has issued a number of mechanisms and policies to encourage the flow of capital and technologies into rural and agricultural development, and this has already begun to show results, he said.

Analysts suggested however that the Government should soon issue regulations governing implementation of agreements along agricultural value chains with clear sanctions for violations to minimise risks and ensure their stability./.

Source: VNA
en.vietnamplus.vn

Related News

Banks still "struggling" to find tools for handling bad debt

Banks still "struggling" to find tools for handling bad debt

VCN - According to financial experts, the rising trend in bad debt continues to pose significant challenges to debt resolution and recovery efforts at credit institutions (CIs).
Hanoi: Maximum support for affiliating production and sustainable consumption of agricultural products

Hanoi: Maximum support for affiliating production and sustainable consumption of agricultural products

VCN - Hanoi City aims to have clean agriculture by 2030, from land, water to air, and clean the environment, especially rivers. Hanoi must create a difference for agricultural product brands, products must be certified and must build the brand "made in Hanoi".
Continue to handle cross-ownership in banks

Continue to handle cross-ownership in banks

VCN - The situation of excess share ownership, cross-ownership between credit institutions (CIs), CIs and enterprises, although has decreased significantly compared to previous periods, is still complicated and requires continued inspection and control.
Storm No. 3 "knocks down" many small businesses

Storm No. 3 "knocks down" many small businesses

VCN - According to the General Statistics Office (Ministry of Planning and Investment), looking at the growth results in the third quarter of 2024, it can be seen that the damage in agriculture after Storm No. 3 (Storm Yagi) was the largest. Meanwhile, the number of Vietnamese enterprises operating mainly in the industrial, construction and service sectors, so the impact was not as severe as in the agricultural sector.

Latest News

Personal income tax proposed for interest on some bank savings accounts

Personal income tax proposed for interest on some bank savings accounts

Instead of the current personal income tax exemption on interest from all individual bank savings accounts, the proposal would exempt tax only for low amounts of savings.
Banks set for aggressive bond issuance in 2025 to fuel growth

Banks set for aggressive bond issuance in 2025 to fuel growth

With a higher credit growth goal set by the SBV, banks are ramping up their efforts to secure funding through bond issuance.
Central bank cuts interest rate on bills for first time in 2025

Central bank cuts interest rate on bills for first time in 2025

According to data from the financial data provider Wichart, the SBV issued VNĐ19.6 trillion of bills in the past week. The interest rate on the bills decreased by 0.1 percentage point, from 4 per cent to 3.9 per cent on February 14.
Focusing on inspecting inventory of public assets at units with large and complex assets

Focusing on inspecting inventory of public assets at units with large and complex assets

VCN - According to Official Dispatch No. 1456/BTC-QLCS on inspecting the preparation and implementation of the General Inventory of Public Assets recently issued by the Ministry of Finance, the inspection of the inventory of public assets focuses on units with large asset scale and large number of inventory items, complex assets, and slow implementation progress.

More News

The government seeks approval for revised GDP, CPI targets

The government seeks approval for revised GDP, CPI targets

VCN - The Government submitted to the National Assembly for consideration and comments on adjusting the target for the growth rate of gross domestic product (GDP) to 8% or more; the average growth rate of the consumer price index (CPI) to about 4.5-5%.
Fiscal, monetary policies support demand stimulation, price stabilisation

Fiscal, monetary policies support demand stimulation, price stabilisation

These efforts, in conjunction with the implementation of monetary policies and other macroeconomic policies, aim to solve difficulties for businesses and the public, stabilise the macroeconomy, control inflation, ensure the balance of the economy, promote economic growth, and secure social welfare and people’s livelihoods.
Vietnam secures VND 157 billion from state enterprise divestment in 2024

Vietnam secures VND 157 billion from state enterprise divestment in 2024

VCN - The Ministry of Finance reported that in 2024, the divestment of state capital in 5 enterprises (F1) generated VND 157 billion from an initial value of VND 145 billion
Vietnam gears up for potential inflation impact in 2025

Vietnam gears up for potential inflation impact in 2025

VCN - For sound price management and inflation control, Deputy Prime Minister Ho Duc Phoc directed officials to vigilantly track both domestic and international market dynamics. The goal is to proactively develop flexible strategies and solutions, enabling a swift response to any emerging challenges.
VN’s credit conditions in 2025 expected to be stable

VN’s credit conditions in 2025 expected to be stable

The credit conditions for Việt Nam will stabilise in 2025, after improving substantially over the past year, the rating agency VIS is forcasts.
State revenue in first month of the year equal to 14% of the estimate

State revenue in first month of the year equal to 14% of the estimate

VCN - According to the Ministry of Finance, in January - the first month of 2025, the total state budget revenue is estimated at VND275.9 trillion, equal to 14% of the estimate; meanwhile, the total state budget expenditure is estimated at VND134.4 trillion.
Securities 2025 expects a breakthrough in scale and quality

Securities 2025 expects a breakthrough in scale and quality

VCN – The positive factors inherent in the macro economy and the Vietnamese stock market will continue to create the foundation for the market to maintain stability, good liquidity, and growth in both scale and quality in the new year of At Ty 2025, Chairwoman of the State Securities Commission Vu Thi Chan Phuong said.
Cash reserves in stock accounts at six-quarter low amid margin rise

Cash reserves in stock accounts at six-quarter low amid margin rise

These funds are readily available in investor accounts, but remained undeployed as of the year-end.
Five solutions for developing stock market in 2025

Five solutions for developing stock market in 2025

VCN - On February 5, 2025, at the Gong-beating ceremony to open the stock trading at the Ho Chi Minh City Stock Exchange (HOSE), Deputy Minister of Finance Nguyen Duc Chi introduced five solutions for comprehensive development of the stock market.
Read More

Your care

Latest Most read
Personal income tax proposed for interest on some bank savings accounts

Personal income tax proposed for interest on some bank savings accounts

Instead of the current personal income tax exemption on interest from all individual bank savings accounts, the proposal would exempt tax only for low amounts of savings.
Banks set for aggressive bond issuance in 2025 to fuel growth

Banks set for aggressive bond issuance in 2025 to fuel growth

With a higher credit growth goal set by the SBV, banks are ramping up their efforts to secure funding through bond issuance.
Central bank cuts interest rate on bills for first time in 2025

Central bank cuts interest rate on bills for first time in 2025

According to data from the financial data provider Wichart, the SBV issued VNĐ19.6 trillion of bills in the past week. The interest rate on the bills decreased by 0.1 percentage point, from 4 per cent to 3.9 per cent on February 14.
Focusing on inspecting inventory of public assets at units with large and complex assets

Focusing on inspecting inventory of public assets at units with large and complex assets

VCN - According to Official Dispatch No. 1456/BTC-QLCS on inspecting the preparation and implementation of the General Inventory of Public Assets recently issued by the Ministry of Finance, the inspection of the inventory of public assets focuses on units
The government seeks approval for revised GDP, CPI targets

The government seeks approval for revised GDP, CPI targets

The Government submitted to the National Assembly for consideration and comments on adjusting the target for the growth rate of gross domestic product (GDP) to 8% or more
Mobile Version