Credit room has been eased, can enterprises solve the "thirst" for capital?

VCN - Last week, the State Bank of Vietnam (SBV) issued a notice stating that it has adjusted the credit growth target (room) in 2022 for credit institutions.
Rapidly Rapidly "inject capital" to support businesses
Credit room has been eased, can enterprises solve the
Enterprises are entering the year-end order production season, so their capital needs increase. Photo: H.Deu

This move is to help enterprises solve their "thirst" for capital to have more opportunities to recover after the pandemic.

Actively allocating capital

In this credit limit adjustment, Sacombank was granted 4%, bringing the total credit growth limit for the whole year to 11%.

From now until the end of the year, Sacombank will have about VND15,000 billion to supply the economy. A representative of this bank said that the credit room would be granted to priority areas according to the orientation of the Government and the State Bank, credit for real estate would continue to be limited or if so, it only implemented the contracts which had already committed to granting credit in advance.

At Vietcombank, this bank said that the State Bank approved increasing the maximum credit balance by 2.7% until December 31, 2022 for Vietcombank.

Thus, during the whole year of 2022, Vietcombank was able to increase its credit by 17.7%. A representative of Vietcombank said that in order to be granted more room, the bank had to make efforts to implement the criteria and targets on capital safety, liquidity, and management quality as well as achieve good results in terms of business operations.

Besides, Vietcombank also implemented the instructions of the SBV such as reducing interest rates, lending to businesses and people as well as supporting weak credit institutions. Therefore, the additional credit source will be controlled by Vietcombank in essential sectors and industries of the economy, priority areas of the Government, supporting the process of economic recovery and development as well as recovery and development of enterprises.

Similarly at MB, with an additional level of 3.2%, equivalent to VND12,000 billion, Mr. Nguyen Thanh Trung, a member of the Board of Management, said that MB intended to allocate about 90% for loans of production and business activities within the next month. This was the segment that has had a huge demand for loans in the past two months. In addition, MB also said that it was interested in consumer loans, retail loans to stimulate consumption, people's spending, and create consumption for enterprises.

At VIB, this bank is allowed to expand the room by 3%. Mr. Han Ngoc Vu, CEO of VIB, said that the bank would focus on retail banking, supporting people to buy houses, buy cars, and grow the credit card segment. In addition, VIB would also be interested in credit for small and medium enterprises, import-export enterprises, and logistics.

Not much room left

In this expansion of credit room, many enterprises likened it to a "medicine" to solve their "thirst" for capital. Because after a period of rapid growth in the first months of the year, in the last 2-3 months, many banks have been "running out of room", so they have tightened credit, limiting the borrowing needs of enterprises.

Therefore, enterprises are expecting a lot from the ability to access capital after this loosening, especially as September is the peak season for domestic and export orders at the end of the year and productions for the Tet holiday.

Talking about this issue, according to Mr. Mac Quoc Anh, Vice Chairman of Hanoi Association of Small and Medium Enterprises, enterprises need a lot of capital to cover all production and business activities and employees. In particular, small and medium enterprises always need capital to build brands, participate in fairs, trade to promote products, and expand markets, especially potential export markets.

There is a high expectation of the bank's move to loosen the credit room, but Mr. Tran Viet Anh, Chairman of the Board of Directors, General Director of Nam Thai Son Import-Export Joint Stock Company, said that banks should bring allocated credit to enterprises that have had a good recovery in the past eight months, creating many products, using a lot of labour, and having an effective volume of import and export orders so that those enterprises can maintain production, and increase stockpiling of raw materials.

However, according to many enterprises, access to capital is still very difficult because there is no collateral, no or little profit due to the impact of the pandemic, so it is impossible to prove cash flow.

In addition, banks also said that enterprises may have to wait because the number of documents is still very high. Moreover, considering the fact that the credit room is not increased too much and banks have had strong credit growth since the first half of the year, the lending room in the last four months of the year is also very limited.

According to calculations, by the end of August, credit has increased by about 9.9% compared to the end of 2021, with the full-year operating target at 14%, it is estimated that another VND400,000 billion of capital will be allocated.

Therefore, the solution proposed by banks is to accelerate the collection of matured debts to open up more room for new credit, speed up capital turnover, along with promoting service activities, cross-selling products, and insurance business to increase non-interest income.

By Huong Diu/ Binh Minh

Related News

The Minister of Finance chaired the Vietnam - Korea Financial Investment Promotion Conference

The Minister of Finance chaired the Vietnam - Korea Financial Investment Promotion Conference

VCN - On March 7, in Seoul Capital, South Korea, the State Securities Commission (SSC) organized a financial investment promotion conference with the theme "Vietnam - Investment destination". Minister of Finance Ho Duc Phoc attended and chaired the Conference.
Accelerate disbursement from solutions of Treasury system

Accelerate disbursement from solutions of Treasury system

VCN - One of the nine key tasks set by the State Treasury system in 2024 is to strictly control payment in compliance with the law and to strengthen coordination with relevant units to promptly remove problems and speed up the disbursement of public investment capital.
Which locality leads in attracting FDI capital in the first two months of the year?

Which locality leads in attracting FDI capital in the first two months of the year?

VCN - According to data from the Foreign Investment Agency (Ministry of Planning and Investment), in the first two months of 2024, there was more than US $4.29 billion of FDI capital invested in Vietnam.
Export growth supports the economy and stock market

Export growth supports the economy and stock market

VCN - Vietnam's export growth is on the recovery path, thereby becoming a positive signal for the economy as well as the stock market in 2024.

Latest News

Good management of public debt creates room to implement expansionary fiscal policy

Good management of public debt creates room to implement expansionary fiscal policy

VCN - Public debt safety indicators continue to be strictly controlled in the safe limit. With a lower debt level than the current ceiling rate, and a favorable debt structure, Vietnam has a lot of room to implement expansionary fiscal policy to allocate loans for large projects as an economic growth engine.
Deposit interest rates forecast to hit bottom in Q1 2024

Deposit interest rates forecast to hit bottom in Q1 2024

Some private banks have recently started to inch up interest rates mainly for short terms of less than five months to 2.5-3.8 per cent per year to attract more depositors after the Lunar New Year.
Urging issuance of e-invoices in petroleum retail

Urging issuance of e-invoices in petroleum retail

VCN - The Government, the Prime Minister, the Ministry of Finance and other agencies have issued many instructions to implement electronic invoices on every sale at petroleum retail stores. Besides the achieved results, this work still has difficulties. The tax sector has been taking drastic action to urge the coverage of e-invoices in the petroleum retail trading.
Credit package of VND120 trillion: must be disbursed as soon as conditions are met

Credit package of VND120 trillion: must be disbursed as soon as conditions are met

VCN - According to the State Bank of Vietnam (SBV), so far, only 28 out of 63 provincial People's Committees have sent documents or announced the list of projects participating in the VND120 trillion credit package, including 30 out of 68 projects with capital borrowing needs.

More News

Effectively implement the State

Effectively implement the State's credit capital investments to attract borrowers

VCN – Motivated by over VND 200,000 billion of the State’s credit capital investment poured into the economy, key economic projects have been implemented and achieved positive results. Therefore, removal of bottlenecks and obstacles will create more attraction and promote the role of the State's credit capital investments.
Foreign investors net sell strongly, VN-Index extends losses

Foreign investors net sell strongly, VN-Index extends losses

The VN-Index closed the week on a negative note, extending its corrections to the second day after soaring above 1,270 points on Wednesday.
Tax Industry actively supports during the peak month of tax settlement

Tax Industry actively supports during the peak month of tax settlement

VCN – With the goal of facilitating taxpayers in complying with tax law polices, especially tax finalization procedures, the Tax industry actively supports enterprises and people in this work. Local tax departments have held online and offline meetings to promptly remove difficulties and obstacles in the tax finalization process.
Vietnam’s stock market meets 7 of 9 criteria for upgrading the stock market

Vietnam’s stock market meets 7 of 9 criteria for upgrading the stock market

VCN – “Vietnam’s stock market meets 7 of 9 criteria in upgrading the stock market, and may be upgraded by 2025, thanks to great efforts of state management agencies and market members” said by experts at the talk show held on March 5.
Syndicated lending proposed to reduce impacts of loan limit policy

Syndicated lending proposed to reduce impacts of loan limit policy

A new regulation on reducing the loan limit under the amended Law on Credit Institutions will adversely affect capital supply for enterprises so commercial banks should cooperate in providing syndicated loans for businesses, experts said.
General Department of Taxation holds an online conference to support tax finalization in 2023

General Department of Taxation holds an online conference to support tax finalization in 2023

VCN - To support and guide taxpayers to perform tax finalization in 2023, and realize the goal of digital transformation, diversify forms of communication and support to taxpayers, on March 12, the General Department of Taxation organized an online Conference to guide and answer questions related to 2023 corporate income tax and personal income tax finalization.
MoF holds investment promotion conference themed “Vietnam - Investment Destination” in Japan

MoF holds investment promotion conference themed “Vietnam - Investment Destination” in Japan

VCN – Minister of Finance Ho Duc Phoc chaired an investment promotion conference themed “Vietnam – Investment Destination” in Tokyo, Japan on March 12. This event continues the success of the Investment Promotion Conference in Korea and is part of the financial investment promotion program of the Working Group of the Ministry of Finance and the State Securities Commission (SSC).
Minister Ho Duc Phoc worked with Mizuho Bank

Minister Ho Duc Phoc worked with Mizuho Bank

VCN - On March 11, in Japan, the Ministry of Finance's working delegation led by Minister Ho Duc Phoc had a working session with Mizuho Bank. Mr. Masahiko Kato, President and General Director, and the board of directors welcomed and worked with the delegation.
Creating a breakthrough in financial cooperation between Vietnam and New Zealand

Creating a breakthrough in financial cooperation between Vietnam and New Zealand

VCN - On March 11, within the framework of the official visit to New Zealand of Prime Minister Pham Minh Chinh, Mr. Bui Van Khang, Deputy Minister of Finance of Vietnam and Ms. Caralee McLeish, Executive Director of the Treasury of New Zealand signed a Memorandum of Understanding (MoU) on financial cooperation for the 2024 – 2026 period.
Read More

Your care

Latest Most read
Good management of public debt creates room to implement expansionary fiscal policy

Good management of public debt creates room to implement expansionary fiscal policy

VCN - Public debt safety indicators continue to be strictly controlled in the safe limit. With a lower debt level than the current ceiling rate, and a favorable debt structure, Vietnam has a lot of room to implement expansionary fiscal policy to allocate
Deposit interest rates forecast to hit bottom in Q1 2024

Deposit interest rates forecast to hit bottom in Q1 2024

Some private banks have recently started to inch up interest rates mainly for short terms of less than five months to 2.5-3.8 per cent per year to attract more depositors after the Lunar New Year.
Urging issuance of e-invoices in petroleum retail

Urging issuance of e-invoices in petroleum retail

VCN - The Government, the Prime Minister, the Ministry of Finance and other agencies have issued many instructions to implement electronic invoices on every sale at petroleum retail stores. Besides the achieved results, this work still has difficulties. T
Credit package of VND120 trillion: must be disbursed as soon as conditions are met

Credit package of VND120 trillion: must be disbursed as soon as conditions are met

Only 28 out of 63 provincial People's Committees have sent documents or announced the list of projects participating in the VND120 trillion credit package
Effectively implement the State

Effectively implement the State's credit capital investments to attract borrowers

VCN - According to regulations, Vietnam Development Bank (VDB) is a policy bank operating under the model of a one-member limited liability company with 100% charter capital held by the State and for non-profit purposes.
Mobile Version