Banks enjoy growth but stay below target

Banks enjoy growth but stay below target

The banking industry witnessed a positive increase in credit growth over the past four months, with commercial banks reporting higher profits, according to the State Bank of Viet Nam (SBV).

The central bank said credit growth rose 1.4 per cent in the period compared to late 2012, and 0.2 per cent more than in the first four months of last year.

Despite the improvement, growth was still lower than targeted due to low borrowing demands from enterprises and the production sector.

SBV had previously set the growth target to ensure credit quality and liquidity among credit institutions.

Last week, BIDV and Vietcombank officially released their Q1 results for this year.

BIDV posted an after-tax profit of VND1.087 trillion (US$51.7 million) and Vietcombank reached an after-tax profit of VND1.086 trillion ($51 million).

Capital mobilisation

SBV Governor Nguyen Van Binh said that capital mobilisation starting from January this year had been bounced back compared to the same period in 2011 and 2012. Up to April 23 this year, capital mobilisation rose 5.34 per cent against late 2012.

Capital mobilisation in Vietnamese dong was higher than foreign currencies, said

Binh, noting that depositor confidence in credit institutions had improved considerably.

In the last four months, available credit had remained stable and exceeded compulsory reserves required by the SBV.

The inter-bank interest rate remained low and saw a light decline against earlier this year. Thanks to stable liquidity, credit institutions had taken the initiative of supplying capital for businesses, said Binh.

vietnamnews