Credit growth of 12%, do not try

  State Bank of Vietnam (SBV) is under great pressure to "run" the credit growth target of 12%, the first 6 months of the new year is up about 3%.


    In a 13-page report to answer questions at the fifth meeting of the National Assembly XIII, SBV Governor Nguyen Van Binh said 4 months, the profits of the whole industry was only 13.100 billion, of which many single have negative earnings. Results actual business is much lower, because the implementation of Decision 780 on debt restructuring for banks helped companies significantly reduce the level of risk provisioning. By end of the month 4/2013, the balance of risk reserves set aside unused reached 73,600 billion dong, an increase of 14.6% compared to the end of 2012. Thanks to this funding, partially treated bad debt.


    The Governor added that the first 4 months of 2013, the bank had processed 76,700 billion of bad debt from risk provisions. Total bad debt by the end of the system was 137 100 billion in April, up 15.8% compared to the end of 2012, while the first 4 months of 2012, loans increased by 36.2%. Gains of bad debt has been contained, but the result is not as desired, by credit debt growth slow last time that the NPL ratio increased

 

                                            SB strive credit growth of 12% or higher


    In fact, credit growth in the first months of 2013 was greatly improved, in June last year all positive, then from March this year had positive growth, but only about 3%. Report on assessment of Vietnam's economy 5/2013 Financial Supervisory Commission said countries, credit and slow growth forecast difficult to achieve the plan for 2013 is 12%. To achieve the target annual credit growth is very difficult task in the context of the ability of firms to absorb limited capital, real estate market activity, and moderation of aggregate demand, the economy is weak.


    At a preliminary meeting and the first 6 months of deployment tasks banking sector last 6 months of 2013, the Governor said, striving credit growth reached 12% in 2013, if possible, a higher little as 12-15% to ensure this year's economic growth reached 5 - 5.5%. Report of the Financial Supervisory Commission also recommends countries, monetary policy should target efforts to achieve 12% credit growth for 2013 to ensure investment in the economy.


    However, according to Mr. Tareq Muhmood, CEO Bank ANZ Limited (Vietnam), credit growth is slow no matter what and do not get too uptight to figure how much growth , which is growing with the credit quality like. Therefore, the banks do not necessarily run on 12% growth target and should not in any way lend.


    Agreeing, Dr. Nguyen Tri Hieu, banking experts say, the central bank is under pressure to "run" the credit growth target, but the banking industry achieved a credit growth of 8-10% was very good. More important still is the credit quality, if not guarantee, the credit quality of the banking system and the economy will pay a heavy price as bad debt. The whole banking sector needs restructuring credit quality and continued restructuring of the whole economy.


    "Credit should go to the correct address provided, while ensuring repayment sources", TS. Hieu said.


    Nguyen Phuoc Thanh, general director of Vietcombank share, plus DN of group 2 upwards dramatically decreased, DN itself weakened and can not absorb the capital and "patient" are also not pour good food be cured immediately.


    According to some economists, the economy's aggregate demand is still weak and there is not a significant improvement. Generally, the first 5 months, the increase (excluding the price factor) of total retail sales and consumer services was 4.8%, almost no improvement compared with 4.6% of 4 months of the year and much lower than the 6.6% and 6.4% of the first 5 months of 2012 and 2011. Compared to the same period last year, the cargo of the first 5 months of 2013 increased only 1.5%, the even flow of goods fell 3.1%.


    According to statistics of the Ministry of Planning and Investment, in 5/2013 and the dissolution of companies suspended operations was 3,590 enterprises, bringing the total number of the country in the first 5 months of the year to 23 226 enterprises, with nearly half of DN dissolution or bankruptcy of the previous year (53 972 DN 2012, DN 54 198 in 2011). Number of enterprises dissolved and suspended average monthly activity is also increased, from 4,498 DN / DN 4517 to May 2011 / May 2012 and up to 4646 DN / month in the first 5 months of 2013.


    In addition, state budget revenues and difficult, while demand for expanded investment from the state budget to support growth with spending increasing salaries and social allowances for hard cuts, which cost Budget almost all geographical balance to narrow.


    "Most likely, this year's economic growth was only 5 - 5.2% credit growth should not necessarily reached 12%. The most important thing is the quality of credit to bad debt risk reserve ", an economic expert said.