Business  » Banking & Finance

The State Bank of Vietnam has allocated 2012’s credit growth caps for more lenders.

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Accordingly, the caps for Military Commercial Joint Stock Bank (MB) and Saigon-Hanoi Commercial Joint Stock Bank (SHB) are 17 per cent and 15 per cent respectively.

With the new allocation, MB has been grouped as ‘healthy bank’ following the SBV standard.

The group now includes the Bank for Agriculture and Rural Development of Vietnam (Agribank), Asia Commercial Joint Stock Bank (ACB), Vietnam Export-Import Commercial Joint Stock Bank (Eximbank), Maritime Commercial Joint Stock Bank (Maritime), Vietnam International Commercial Joint Stock Bank (VIB) and Vietnam Prosperity Commercial Joint Stock Bank (VPBank).

SHB has been categorized as ‘average bank’, within the group including Nam A Commercial Joint Stock Bank (Nam A Bank), Dai A Commercial Joint Stock Bank (Dai A Bank), Kien Long Commercial Joint Stock Bank (Kien Long Bank), and Orient Commercial Joint Stock Bank (OCB).

Four biggest banks have already cut lending rates

Agribank has begun to cut lending rates by 1-1.5 per cent for all customers borrowing money for production.

The short-term floor rate for families operating in agriculture-forestry-fishery-salt production is 15.5 per cent, while that for firms producing and exporting goods in the fields of agriculture-forestry-fishery-salt is 14.5 per cent.

In addition, the short-term floor rates for borrowers making money from processing agricultural goods for the local market or producing agricultural materials, like fertilizers or pesticides, and technologies is 1.5 per cent.

For other sectors, the lowest lending costs range from 17-19 per cent for short and medium-term lending.

With the recent moves, the four biggest Vietnamese lenders with 55-60 per cent of the market share, have already cut the lending rate for specific groups of borrowers, mainly goods manufacturers, said Agribank’s chairman Bui Ngoc Bao.

The other lenders are the Bank for Investment and Development of Vietnam (BIDV), the Bank for Foreign Trade of Vietnam (Vietcombank), and the Bank for Industry and Trade of Vietnam (VietinBank).

Agribank will set aside VND54 trillion for lending in 2012, Bao said, adding that VND44 trillion will be allocated for short-term lending and the rest for medium-and long-term lending.

Most of the lending will be prioritized for those operating in agriculture, forestry, fishery, and salt production, he emphasized.

Agribank’s total outstanding loans are expected to increase 10 per cent year on year, while that for agriculture and rural development will rise 15-18 per cent year on year, making up 70 per cent of total outstanding loans for the sector.

As of December 31, 2011, Agribank’s total outstanding loans were VND443.47 trillion, up 7 per cent over the previous year.

The total outstanding loans for agriculture and rural development were VND301.6 trillion, making up 68 per cent of total outstanding loans for the sector.