On Oct. 29, the State Bank of Vietnam decided to decrease deposit rates for short-term deposits by 5.5% per year down as well as lending rates for priority areas by 7% per year.
Clients at BIDV Binh Duong.
This decision creates a positive signal for commercial banks to accelerate production and business in the year-end and implement goal of credit growth in this year.
Saving costs for enterprises
On the area of production and business, the State Bank’s decision of adjusting interest rates was set out in the time that enterprises strengthened to purchase materials and reserve goods for Tet holiday 2015.
This is the period many companies need to capital for production. Though lending rate reduction is not high, this brings many interests for 97% of small and medium enterprises in this province.
Nguyen Thi Tham, the owner of Tan Thanh Tan Dinh Trade Company in Tan Uyen town said “I borrow capital to invest in reserving materials, petrol and oil and more. At present, lending rates are in proper level, so my business profit is stabilized. As such, goal of cutting lending rates according to enterprises’ wish is implemented”.
Tran Ngoc Linh, director of Bank for Investment and Development of Vietnam (BIDV) – Binh Duong branch said that implementing the instruction of the State Bank of Vietnam, BIDV Binh Duong applies rate of 5.5 per cent/year for 6 month-term and 6.5% per year for 12 month-term.
Besides, BIDV Binh Duong plunged lending rates on all loans from 0.5% to 0.8% per year compared with the current period. As for the short-term loans for 6 priority groups, lending rate is cut by 7% per year. Along with cutting lending rates, BIDV launches strongly credit package to serve for programs of import, export, aqua-products, social housing and among others.
Together with BIDV, other commercial banks in this province also implement this cutting on lending and deposit rates seriously.
Stimulating consumption and production
At present, aside from short-term deposit rates, longer-term deposits have been reduced slightly to 7.5 per cent for 12 month-term. In addition, lending rates are declined along. Accordingly, aside from lending rates for 6 priority groups cut down by 7.5% per year, non-priority loans are decreased along at 9-10% per year. Some banks launch lending programs with incentive rates of 9% per year.
Rep of Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank) said that in the two remaining months of this year, Sacombank has launched a VND5tril preferential package to cater for clients in a bid to meet local people’s demand on capital.
At present, Sacombank applies lending rate of about 8% per year to satisfy clients’ demand on capital in the year-end.
According to Tran Ngoc Linh, Sacombank prepares adequately for capital to meet clients’ demand. And, this bank could complete its goal of growth with the 30% increase in this year compared with the previous year.
In the cutting on lending and deposit interest rates, clients involving in agricultural field enjoy most interests. Besides, enterprises, producers with new investment projects also enjoy the lowest lending rates over recent years. This stimulates demand on loans for production and business.
As of the end of quarter of this year, the total outstanding of banking system in this province reached more than VND72,000bil, an 8.9% increase compared with the early year. Of this, the total loan of the third quarter of this year was at high growth compared with the second quarter of this year while the total loan of middle and long-term loans increased 8.4%.
As such, credit growth in this current period shows a good growth. With this growth, banking system in Binh Duong will reach goal of credit growth for the whole of this year.
Reported by T.HONG – Translated by A.C
