In 2018, the State Bank targets to reach a credit growth rate of 17%

	SBV to rate local credit institutions
	SBV: criminal investigation on ex-leader not affect Vietnam's monetary policy
	Commercial banks propose SBV to set higher credit growth limit

The SBV has deployed synchronously measures and achieved the targets set out. Photo: H. Diu

At the press conference to announce results of monetary policies in 2017 and deploy the task for 2018 held by the SBV on the afternoon of 8th August 2017, Deputy Governor of SBV Nguyen Thi Hong said that in 2017, on the basis of closely following resolutions of the Government and National Assembly, the SBV has deployed synchronously measures on monetary policies and banking operation and achieved the targets set out at the beginning of the year, thereby contributing significantly to controlling inflation and stabilizing macro economy, supporting the economic growth and ensuring the operation of credit institutions.

Therefore, it was estimated that total M2 tools raised about 16%, credit grew 18.17%, but 80% of debtsconcentrated on business and production field; short-term lending interest rate for prioritized fields reduced 0.5% per year, the interest rate through some credit support programs for enterprise development was reduced to a lower rate than the ceiling rate of SBV (0.5-1% per year lower).

Besides, exchange rate and foreign currency market was stable. The SBV continued to regulate flexibly the central rate. As evaluated by the Bloomberg, VND was one of most stable currencies in Asia. Accordingly, the SBV has supplemented a large amount for foreign exchange reserves.

In addition, the gold market continued to be stable. The market did not exhibit gold bar fever and speculation, causing instability to exchange rate, foreign currencies and macro economy. A part of gold capital was initially transformed to serve socio-economic development.

Particularly, the restructuring and the handling of bad debts has achieved positive results. In 2017, the legal framework for the restructuring of the credit system associated with the handling of bad debts has been gradually improved. Bad debts continued to be controlled and remained at below 3%.

So, in 2018, Deputy Governor Nguyen Thi Hong said that the SBV Governor has set out oriented targets for credit institutions to stick at supporting the objective of inflation control and macroeconomic stability. Thus, credit growth rate in 2018 is oriented up by about 17%, lower than that in 2017 .

Regarding the interest rate, the SBV representative stated that in Resolution No. 1 in 2018, the Government instructed the SBV to continue managing monetary policy in the direction of reducing the lending interest rate and supporting the business and production. This is also the expectation of the banking sector in 2018. Thus, the SBV will consider synchronously coordinating the time, context, economic development and market liquidity to have appropriate operation. The SBV will be flexible to ensure the general growth objective of the sector and each credit institution.

Moreover, the SBV Deputy Governor also said that in the coming year, the SBV would continue to manage the exchange rate actively and flexibly to stabilize the foreign currency market, to increase foreign exchange reserves. In particular, the SBV would accelerate the restructuring of the credit institution system associated with the handling of bad debts in a more radical manner. According to the deputy governor, over the past time, the handling of bad debts or restructuring the credit institution system was not as expected and not radical due to legal obstacles. But National Assembly’s Resolution 42 on pilot handling of bad debts and the Law amending and supplementing the Law on Credit Institutions, which has been adopted, would help to achieve better results in 2018.

Foreign currency credit control: It should be appropriate VCN- In the first 10 months of 2017, foreign currency credit has increased sharply due to many ...

In addition, the SBV would continue to improve the legal framework for payment operation in the economy, promoting non-cash payments; intensifying the renovation and enhancing the efficiency of the banking inspection and supervision and administrative reform.