In 2017, provincial GRDP grew by 9.15% while the growth of credit in the province was approximately 20%. In 2018 the local credit institutions target to assist the economy with the growth of 20-22% compared to 2017.
Various measures of credit increment
Vo Dinh Phong, Acting Director of the State Bank of Vietnam - Binh Duong Branch, said that from the beginning of 2017, commercial banks in the province closely followed the direction of branches and localities to launch activities and operate on a safe basis, ensuring the set-out growth targets. In particular, credit institutions have launched many savings packages with attractive interest rates to attract sources of money from customers. Total capital mobilized in the province in the past year increased by 16.49% compared to 2016. Credit flow directed to focus on production, business and priority sectors such as agriculture, rural, exportation, small and medium enterprises (SMEs), supporting industries, and hi-tech enterprises.
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In 2018, banking sector continues to reduce loan interest rates to assist production and business operations of enterprises. In this photo: Customers are carrying out transactions at Nam A Bank JSC – Binh Duong Branch. Photo: Thanh Hong
In 2017, the system of credit institutions in the province achieved credit growth exceeding the target; outstanding loans reached nearly 149 trillion Vietnam dongs, increasing by 20.25% over 2016. The outstanding loans showed that the production and business situation of the enterprises has been favorable, leading to high capital demand. On the other hand, the loan interest rate is in line with the business conditions of enterprises. According to Phong, the state-owned branch of Binh Duong province has seen strong credit growth in the mid-2017. A number of branches of the credit institution also asked the head office to raise this growth target. This is also a high and stable increase over the past 3 years. In 2017, the State Bank set the target of raising credit for the whole year by 20-22%.
On the commercial side, Tran Ngoc Linh, Director of BIDV - Binh Duong Branch, said that in 2017, BIDV has invested in credit with many economic sectors, in which the borrowers' components are individual households, families, small and medium enterprises, priority enterprises and good projects to develop well. The bank's co-operation with businesses includes policies on deposit rates in harmony with the interests of depositors, but the lending interest rates are reasonable to help businesses have a high return on capital and reasonable prices in production and business. According to Linh, the interest rate applied by the bank is from 7 to 10% per annum depending on the payback terms, thereby creating peace of mind for businesses.
As for Le Ngoc Hieu, Director of Nam A Commercial Joint Stock Bank - Binh Duong Branch, in parallel with the reduction of some administrative procedures for short-term loans, banks also have interest packages for loans to support businesses start-up with interest rates of 6 - 10% per annum. This interest rate has helped start-up businesses and SMEs have easy access to capital resources, so the performance indicators of banks also grew satisfactorily.
Enterprises actively supported
It can be seen that the growth of performance indicators of credit institutions in the province has confirmed the development and recovery of enterprises in 2017. In which, together with optimistic psychology that black debts ratio has been secured at 1.6% of total outstanding loans, the credit growth has been high and safe in the planning and consistent with the economic development of the province.
According to the assessment of enterprises, with the support of the State in expanding the market, businesses start lending consumers, banks also have positive dynamics of interest rates. Le Ba Linh, deputy chairman of the Binh Duong Lacquer - Sculpture Association, said that banks' interest rates have provided positive support to businesses. The enterprises also feel somewhat shared, although the loan is still a challenge for many SMEs. Banks should have a more relaxed and preferential policy for credit investment, especially for loans with simple administrative procedures for SMEs.
Under the direction of the Government, the State Bank of Vietnam, Phong said that in 2018, the State Bank of Vietnam - Binh Duong Branch will continue to direct the system of commercial banks, credit funds and people in the province continue to implement credit programs and policies for a number of branches and domains so that credit institutions could expand their credit effectively according to the socio-economic development policy of the government. Phong said that in 2018, the banking sector of Binh Duong province plans to increase its outstanding loans by 20-22% compared to 2017. Capital mobilization should be increased by 19-23% and bad debts should be controlled at 3% of total outstanding loans. These targets will further strengthen lending activities of banks, continuing to support businesses to develop more effectively in the future.
Reported by Thanh Hong – Translated by Vi Bao
