The biggest problem now for banks is not the lack of capital to lend, but is that they cannot find borrowers. Though the lending interest rates have been forced down, businesses do not intend to borrow money at this moment.
Much capital, few clients
Deputy General Director of a small bank said that his bank still has 1 trillion dong reserved for lending to businesses at the interest rates of 18-20 percent. However, his credit officers have not found enough borrowers over the last month.
The banker has admitted that the enterprises with good business performance usually seek capital from state owned banks. Meanwhile, the businesses which contacted his bank for loans, cannot meet the requirements to get loans.
He went on to say that the sum of 1 trillion dong has been injected in short term investment deals, while waiting for more borrowers to come. The bank can obtain the credit growth rate of 8 percent this year only, but the banker fears that he would not use up the quota, because it is very difficult to lend now.
A senior executive of VIB Bank has also complained that it is very difficult to find good clients to lend. It is now a tough period for enterprises, which means that banks have to face high risks in providing loans.
He said that the bank now has to analyze the finance reports of borrowers thoroughly before deciding to disburse money. In some cases, the bank only accepts to lend the sums of money lower than the amounts wanted. At present, VIB is offering credit packages to import and export companies, food and drink manufacturers with the preferential interest rate which is lower by 1.5 percent per annum than the normal rate.
Phuong Dong Bank in early March also urged its credit officers to look for borrowers. Meanwhile, the bank has decided to slash the lending interest rate to 18 percent for the short term loans (for less than 12 months). A credit officer of the bank said that though the bank wants to push up lending, it will have to think twice before making disbursement, or the overdue debts would increase.
Ocean Bank is running a program on providing preferential loans to enterprises, cooperatives, households and individuals in the agricultural production, forestry, fisheries, at the preferential interest rates lower by 2-3 percent than the normal interest rates.
The bank has also decided to offer a preferential credit package worth 500 billion dong with the interest rate of 17 percent per annum to a business in the south.
Le Xuan Nghia, a well known finance expert, has confirmed that capital is profuse at banks, while the lending has got stuck with very few borrowers.
Therefore, a lot of banks have spent money to less-than-five-year buy government bonds at the interest rate of 11 percent per annum.
According to the Bao Viet Securities Company, by the end of March 9, the total trading value of the bond market had reached 47,575 billion dong. The figure was 73 trillion dong in the whole year 2011. Bao Viet has also said that commercial banks were the main buyers of the government bonds.
At the press conference held on March 13 to declare the ceiling deposit interest rate reduction, Governor of the State Bank Nguyen Van Binh also informed that the credit growth rate had decreased by 1.27 percent in comparison with that at the end of 2011.
Source: TBKTSG
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