Credit growth adds up to 16 per cent in 11 months

December 18, 2018 | 08:00

(0) user say

Credit growth has climbed to around 16 per cent by the end of November, possibly on track to meet the target of 17 per cent set for the entire year.

At the annual meeting with foreign credit institutions and other international financial institutions last week, State Bank of Vietnam governor Le Minh Hung noted that the country’s credit growth has been reported at 16 per cent for the 11 months through November and is on track toward the 17 per cent targeted for 2018, with priority given to the sector of manufacturing and processing.

credit growth adds up to 16 per cent in 11 months

Credit growth added up to 16 per cent in the first 11 months of 2018

The credit growth figure that Hung revealed could probably be on par with the growth rate reported for the same period last year by the National Financial Supervisory Commission (NFSC), which was 15.3 per cent.

Commenting on the credit growth, CEO of HSBC Pham Hong Hai said that the central bank has the tendency to reduce the credit growth rate. “While the targeted credit growth is 17 per cent for this year, I think we may be able to end the year with some 14 per cent. In the following years, this could likely be lowered by the SBV. The lower credit growth rate, in my view, is rather appropriate as it would lower inflationary pressure.”

Hai went on to say that even with the lower credit growth rate, the GDP growth has been encouraging. “As such, there is no need for high credit growth rate to prompt GDP growth,” he noted.

Is it time to wave good-bye to the credit growth ceiling?

Experts suggest the central bank to abolish the annual credit growth target and let the market decide its own supply and demand of credit.

Banks in search for additional credit growth space

As many banks have reached their credit growth limit, they are seeking for additional space from the central bank to meet the increasing credit demand ...

Credit growth must be controlled

Authorities need to closely control the rapid increase in Vietnam’s credit-to-GDP gap so as not to cause high inflation as in the past, experts have ...

By Thu Huyen

What the stars mean:

★ Poor ★ ★ Promising ★★★ Good ★★★★ Very good ★★★★★ Exceptional