Bank lending gathers pace in HCM City

A bank branch in HCM City. Bank lending has been accelerating in the city in the first half of the year. — Photo courtesy of ABBANK

HCM CITY — After a slump, bank credit in HCM City has picked up again and is expected to keep rising for the rest of the year since demand for funds is usually high at year-end, the State Bank of Vietnam has said.

Nguyễn Đức Lệnh, deputy director of the central bank’s HCM City branch, said banks’ outstanding loans as of June end were worth over VNĐ3.68 quadrillion (US$144 billion), 11.06 per cent over the same period last year. Loans outstanding in đồng accounted for 96 per cent.

The growth consolidated a rising trend after 2.03 per cent in June, 0.61 per cent in May and 0.35 per cent in April.

Bank lending has helped promote economic growth, he said.

He said the city economy grew at an “impressive” 6.46 per cent in the first six months of the year.

Low interest rates along with focused credit programmes, preferential credit packages and debt restructuring during the period helped businesses.

Action programmes by the banking industry to support enterprises have promoted credit growth, he said.

Out of a preferential credit package worth VNĐ509.86 trillion registered by 17 banks this year, over VNĐ273.78 trillion has been disbursed to more than 79,300 customers through the bank – business connection programme, he added.

Nguyễn Phước Hưng, permanent deputy chairman of the HCM City Union of Business Associations (HUBA), said businesses in the city have high demand for funds.

Some 45 per cent of businesses surveyed by HUBA want lower lending interest rates and more supportive policies to give them a hand in the context that demand has not completely recovered.

Businesses also wanted banks to “share their difficulties” by continuing to reduce loan interest rates, he added. — VNS