SBV asked to keep interests low and financial access easier

Headquarters of SBV in Hanoi. (Photo: VNA)

Hanoi - Prime Minister Pham Minh Chinh has tasked the State Bank of Vietnam (SBV) with leading and coordinating governmental ministries and agencies to keep interest rates low and financial access easier for businesses, according to Directive 18/CD-TTg signed on March 7.

He asked the central bank to conduct reviews on the results of credit issuance by financial institutes across the country, including commercial banks and credit institutions, to stabilise interest rates and stimulate credit growth in 2024, with an emphasis on the timely and sufficient provision of credit to serve the economy and the safety of the financial system.

The PM stressed the importance of taking a proactive, flexible and timely approach to monetary policies in 2024, in line with the main objectives outlined in Resolution 01/NQ-CP dated January 5, which prioritises promoting economic growth, resolving difficulties for production and business, meeting foreign currency needs for production and business, and ensuring macroeconomic stability and inflation control.

The directive said top priorities in 2024 will continue to be reducing interest rates for loans, coupled with enhancing access to credit to support the development of production and business, as well as ensuring sufficient and healthy credit and foreign exchange.

In addition, it emphasises stronger inspection, control and supervision of credit issuance by credit institutions. This is to ensure a flow of credit, including foreign currency credit, concentrated in priority and important areas and growth drivers of the economy and serving the needs of business.

The issuance of credit outside legal regulations, to inappropriate subjects, and the granting of credit to executives, management boards, and their related individuals as well as shadow businesses at preferential interest rates, will be strictly dealt with.

The central bank has been told to keep interest rates low and increase the application of IT technology, as well as promote social responsibility and business ethics among credit institutions.

SBV injects large amount of money to support capital for banks The State Bank of Vietnam (SBV) on February 20 net injected more than 5 trillion VND (nearly 204 million USD) into the banking system through the open market operation (OMO) channel to support capital for commercial banks.

USD rate pressures domestic landscape While exchange rates have undergone considerable volatility, witnessing a surge which positively influences import-export activities, the domestic scene faces renewed pressure, attributed to the VND-USD interest rate being at negative levels.