Vietnam - Spreading the money around

Banks are restructuring lending activities and it’s expected that this will make it possible for the state to reach its 2012 credit growth targets.

Small and medium-sized firms and individual customers are now in the sights of many banks.

DaiA Bank would like to accelerate its credit growth in this second quarter and at the same time mobilise more capital from the community.

One of the bank’s executives said that this year bank loans will be provided mainly to small and medium-sized firms, individuals and trading households. While the bank strives to expand credit growth it will also attempt to keep its bad debt rate to less than 1.5 per cent of total its total outstanding loans.

NamA Bank’s target customers this year are, for the most part, small and medium-sized firms, individuals and trading households and they will be offered loans not to exceed VND10 billion ($476,000) in order to keep the bank’s bad debts at a minimum, said bank chairwoman Nguyen Thi Xuan Loan.

In addition NamA Bank presented a 12 per cent average credit growth plan in non-manufacturing areas while the central bank has regulated that it must not exceed 16 per cent for this year.

VietinBank Chairman Pham Huu Hung said that this year the giant state bank would focus on promoting short-term credit while keeping medium and long-term loans to a minimum, particularly regarding foreign credit. In the meantime, the bank has made credit quality control a top priority this year as it attempts to avoid risk in this time of continuing economic difficulty.

With 17 per cent credit growth this year, VCB will strive to maintain a balance between its credit growth and the amount it holds in deposits. The bank executive said that this year its capital sources will be channeled into agricultural and rural areas, export production and support industries and it will provide supplementary working capital to labour intensive small and medium-sized firms. Loans for businesses that import non-priority commodities will be restricted.

VCB envisages making it possible for small and medium-sized firms and individual customers to obtain loans quicker and it will also strive to ensure credit quality.

For its part, an ACB representative said the bank will promote lending to retailers with priority given to individuals and small and medium-sized corporations.

According to State Bank Governor Nguyen Van Binh, the country’s credit growth contracted over 1 per cent as of March 31, 2012 compared to the 5 per cent credit growth of the first quarter of 2011.

Thuy Vinh | vir.com.vn

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