Econ
Flexible mechanism key for SBV success in economic management
The governor of the State Bank of Vietnam (SBV) Le Minh Huong informed that the foreign exchange reserves of Vietnam has increased 13 billion USD to nearly 52 billion USD.
In 2017, the SBV has been flexible in central rate management mechanism, which ensured that the domestic foreign exchagne market was less affected by global factors. Besides, SBV is determined in pursuing target economic growth rate in relation to the stability of macro economy and controlling the inflation rate at acceptable level.
The increase of foreign exchange reserves has important meaning for SBV to improve capabilities in managing the domestic supply-demand relationship, stabilizing the domestic foreign exchange market, ensuring the security of the national finance and banking system, supporting trade activities, all of which have contributed to build trust among foreign investors looking for investment opportunities in Vietnam.
With regard to the monetary situation, the governor said, in addition to the credit growth, the SBV has been cautious over the safety issue in bank’s operation, mobilizing funds in production and business activities, in which funds for industrial manufacturing and processing contributed 30%, hi-tech agricultural production contributed 28% and rural development with over 21%. SBV also managed measures to manage credit growth to suit with the actual status of macro economy, improving the quality of credit and creating favorable conditions for all economic components accessing credit loan.
The banking system in 2017 has reduced key interest rate from 0.5 – 1%, mnay credit institutions applied the short term lending rate at 4 – 5% and for mid to long term lending rate at 8% for credible customers.
In 2018, SBV has oriented and managed monetary policy to ensure the safety of the system and operations of credit institutions, contributing to the socio-economic development.
Improving the supervision and monitoring process of banking system, ensuring the safety operation of credit institution network. Continuing the process of restructuring credit institutions and non performing loans (NPL).
At the international workshop to discuss solution to tackle NPLs and improve economic prospects in Vietnam on September 26, while being recognized one of the world’s fastest-growing economies, the World Bank evaluated the Vietnamese’s banking system is focusing on dealing with NPLs in recent years.
As such, the implementation of the proposal “Restructuring the system of credit institutions for the period 2011-2015” issued under the Prime Minister's Decision No. 254 /QD-TTg dated March 01, 2012, including the establishment of the Vietnam Asset Management Company (VAMC) in 2013 to acquire NPLs, and subsequent legal and regulatory amendments to banking restructuring signal Vietnam’s determination to tackle NPLs and stabilize the financial sector. While NPL resolution has made positive progress, outstanding and potential NPL volumes remain high, imposing risks on financial institutions’ safety and efficiency
General Director of VAMC Doan Van Thang said, in recent 4 years, in order to control the rate of NPL to under 3%, VAMC has purchased a large amount of NPL. Specifically, as of August 31, 2017, VAMC has purchased 26,110 NPLs from 16,197 customers with value of more than 266 trillion VND. In particular, in 2015, VAMC has purchased a record high number of NPL with more than 100 trillion VND.
In addition to the credit growth, the SBV has been cautious over the safety issue in bank’s operation.
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With regard to the monetary situation, the governor said, in addition to the credit growth, the SBV has been cautious over the safety issue in bank’s operation, mobilizing funds in production and business activities, in which funds for industrial manufacturing and processing contributed 30%, hi-tech agricultural production contributed 28% and rural development with over 21%. SBV also managed measures to manage credit growth to suit with the actual status of macro economy, improving the quality of credit and creating favorable conditions for all economic components accessing credit loan.
The banking system in 2017 has reduced key interest rate from 0.5 – 1%, mnay credit institutions applied the short term lending rate at 4 – 5% and for mid to long term lending rate at 8% for credible customers.
In 2018, SBV has oriented and managed monetary policy to ensure the safety of the system and operations of credit institutions, contributing to the socio-economic development.
Improving the supervision and monitoring process of banking system, ensuring the safety operation of credit institution network. Continuing the process of restructuring credit institutions and non performing loans (NPL).
At the international workshop to discuss solution to tackle NPLs and improve economic prospects in Vietnam on September 26, while being recognized one of the world’s fastest-growing economies, the World Bank evaluated the Vietnamese’s banking system is focusing on dealing with NPLs in recent years.
As such, the implementation of the proposal “Restructuring the system of credit institutions for the period 2011-2015” issued under the Prime Minister's Decision No. 254 /QD-TTg dated March 01, 2012, including the establishment of the Vietnam Asset Management Company (VAMC) in 2013 to acquire NPLs, and subsequent legal and regulatory amendments to banking restructuring signal Vietnam’s determination to tackle NPLs and stabilize the financial sector. While NPL resolution has made positive progress, outstanding and potential NPL volumes remain high, imposing risks on financial institutions’ safety and efficiency
General Director of VAMC Doan Van Thang said, in recent 4 years, in order to control the rate of NPL to under 3%, VAMC has purchased a large amount of NPL. Specifically, as of August 31, 2017, VAMC has purchased 26,110 NPLs from 16,197 customers with value of more than 266 trillion VND. In particular, in 2015, VAMC has purchased a record high number of NPL with more than 100 trillion VND.
