The clients, who borrow money to repair the damage after floods and storms, would be able to enjoy the interest rate of 14.5 percent, or just 0.5 percent higher than the deposit interest rate. However, businesses say the announced low interest rates remain inaccessible.
Le Viet Ha, Chair of Hanco, a food company, said that he now borrows capital from two big joint stock banks in HCM City at the interest rate of 22 percent at maximum. After hearing that some banks have eased the interest rates to 15-17 percent for production companies, he tried to contact some banks. However, Hanco has not received any replies on the preferential interest rates from the banks.
Ha went on to say that Hanco is only trying to maintain the old loans, while the company dare not ask for new loans now, when the interest rate stays firmly at over 20 percent.
“We are trying to sell some assets to pay debts,” he said.
According to him, production companies will only survive if the interest rate goes down to 15 percent. “However, this seems to be a dream, because even the interest rates of 17-19 percent remain unattainable,” he said.
Cao Tien Vi, Chair of the Saigon Paper Company, said that businesses would not be able to borrow money at low interest rates right after the banks’ announcement. “In order to get new loans, businesses have to wait for the old debts to become matured,” he explained.
The paper company is now borrowing money from different banks. The interest rates at small joint stock banks are 21-22 percent, while bigger joint stock banks lend at 19 percent, and state owned banks 17 percent.
Even Dai Dong Tien, a big manufacturer, also has to borrow money at the average interest rate of 17 percent at minimum. According to Dai Dong Tien’s General Director Trinh Chi Cuong, the interest rates have been applied since late 2011, and there has been no adjustment.
Director of a packaging company in HCM City has complained that though he is a loyal client of some banks, he still has to borrow money at 18 percent per annum.
“As the demand is very low in the market, while the interest rates are sky high, a lot of businesses have become worn out, especially small enterprises, which account for the highest proportion in the national economy,” he said.
General director of a joint stock bank in HCM City has admitted that in fact, the 15-17 percent interest rates could be applied to a few clients, who have “good profiles” and good relations with the banks.
Tran Anh Tuan, General Director of Nam A Bank, has affirmed that banks are now capable to ease the interest rates. However, in the immediate time, Nam A Bank can only ease the interest rates slightly by one percent, applied only to good borrowers.
“The downward trend would kick off no sooner than the end of the first quarter,” he said.
A senior executive of Vietinbank said that the bank has low cost capital sources, with which it can ease the lending interest rates. However, in the long term, in order to have lower interest rates, the inflation rate needs to be controlled.
Meanwhile, Dr Le Tham Duong from the HCM City Banking University thinks that in order to slash interest rates, the central bank needs to help banks improve liquidity.
“If banks lower interest rates despite their liquidity problem, businesses would be rescued, but banks would die,” Duong said.
Source: VnExpress
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