Few takers for foreign currency loans
Few takers for foreign currency loans
Unlike in past years when there was great demand from companies for foreign exchange to pay for imports, this year most do not want to borrow money, making it hard for banks to find customers.
Do Duy Thai, general director of Thep Viet Co., said normally steel producers increase imports of feedstock from early December to prepare for production in the next four months.
But the lower consumption of steel products in 2013 had led to high inventory levels, and as a result the demand for US dollar loans had fallen sharply, he said.
According to figures from the State Bank of Viet Nam's HCM City branch, as of December 25, foreign currency outstanding loans were worth VND160.74 trillion (US$7.6 billion), or 16.9 per cent of total bank loans.
It was much lower than the 22 per cent in 2012 and 27.08 per cent in 2011.
The SBV's Circular No 37 early last year on enterprises' foreign currency borrowing causes difficulties for exporters by requiring them to prove their capacity to repay.
With demand slumping many banks have slashed lending interest rates to 3-5 per cent.
VietinBank offers short-term loans at 3.5-5 per cent.
Eximbank, ACB, and Sacombank are charging 4-5.5 per cent for short-term loans.
Pham Hong Hai, deputy director of HSBC Viet Nam, said businesses were forced to use other bank services to get these loans.
But they can get dollar loans from foreign banks at 3-4 per cent without having to use their other services because they have access to cheap funds from their parents.
vietnamnews
