Credit in the first quarter increased insignificantly

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Credit increases and decreases according to the rules of the business season

At the online dialogue themed‘Improving the accessibility to bank capital for small and medium enterprises (SMEs)’, held on April 17 by Tri Thuc Tre newspaper in combination with CafeF, Tran Van Tan, Deputy Director of the Credit Department, said credit in the first quarter of 2019 increased by 3.19% as of March 29, slightly lower than the same period in 2018 (3.29%).

Regarding credit for small and medium-sized enterprises, Tan said the SBV has paid great attention to this group. In the first twomonths of the year, credit for this group decreased slightly compared to 2018, with a decrease of 0.04%. It is expected to increase about1% in the first quarter, equivalent to the same period of 2018.

Tan saidthat the decrease is due to that in the first quarter, there were theNew Year and Lunar New Year holidays, while enterprises raised consumption and recovered money to repay bank loans. Moreover, this is also an annual rule of credit which sees aslight increase in the first quarter, returning to normal operation and quick increase in the third and fourth quarters. Thisis nothing abnormal compared to previous years.

Economic expert Pham Chi Lan expressed concern about credit slowing down in the first threemonths of the year.

Firstly, according to Lan, the number of enterprises stopping operations increased, falling into small and medium enterprises, showing they havedifficulties in many aspects. Therefore, the number of enterprises that need credit is toughto increase when solving existing problems.

Secondly, Lan said enterprises have to make efforts from the beginning of the year and make the most of opportunities. Therefore, the situation of enterprises reflected through credit is a concern.

However, acting Director General of ABBank Pham Duy Hieu said credit growth for small and medium enterprises in the first quarter of ABBank was about negative 1.64 %. But, in the first week of April, this rate returned to zero and grew again. The negative credit growth mainly occurred with customers whose business activities were affected by the Tet holiday, these enterprises enhanced disbursement in the December lunar calendar. In the first quarter, they recovered the money and paid the bank, so credit decreased.

Credit institutions expect better results in Q2

Therefore, according to ABBank's leaders, this is good news rather than worrying, because it proves that these debts are good.