Lenders expect to perform better in 2015
Lenders expect to perform better in 2015
A majority of lenders is of the view that the business environment and their performances improved significantly last year and will continue to see positive progress this year.
The State Bank of Viet Nam (SBV) announced this in a statement on January 15, based on its quarterly survey of business trends for credit institutions and foreign bank branches in Viet Nam.
About 89 per cent of them said their liquidity was better in 2014 and that they expect this situation to continue throughout 2015.
They also expressed optimism for their outlook on economic recovery and stability, with the gross domestic product growing higher than expected at 5.98 per cent and inflation controlled at a low level last year.
Most expect to mobilise more capital from the economy, with deposits likely to grow by approximately 4.5 per cent during the first quarter of 2015 and by about 14.35 per cent over the year.
The expected growth rates for deposits in the Dong are 4.7 per cent and 15.37 per cent respectively, and for deposits in foreign currencies are 3.87 per cent and 6.53 per cent respectively.
"The capacity of credit institutions to mobilise capital witnessed more sustained and reasonable improvements in 2014, although the SBV adjusted the policy interest rates twice last year," the statement added.
Interest rates in the market fell by 1.5 to 2 per cent last year from the previous year's levels, and are likely to remain stable or decrease slightly in 2015.
However, bank deposits are expected to continue expanding as they are considered a secure and efficient investment channel in the context that the stock market is still displaying potential risks and the real-estate market is yet to see any significant recovery.
The credit institutions observed that customers' demand for banking products and services is also growing, and their demand for loans has clearly surged since the fourth quarter of 2014.
Up to 97 per cent of the lenders forecast that outstanding loans will expand at high rates in 2015, with the average lending growth for the entire banking system expected to hit 3.5 per cent in the first quarter of 2015 and 14.57 per cent at the end of the year.
Almost all credit institutions are of the view that bad debt ratios remained stable or declined during the fourth quarter of 2014 and predicted that bad loans will shrink during the first quarter of 2015. A majority of them also believe that their non-performing loans will be lower than three per cent of their total lending amounts this year.
