Talking at the press conference on June 5th on banking activities in the first half of 2020, the State Bank of Vietnam (SBV)’s representative said that as of May 29th 2020, the total means of payment M2 increased by 3.4 percent compared to late 2019, and the liquidity of the credit institution (CI) system was smooth.
From the beginning of the year, the SBV adjusted operating rates twice with a total reduction of one to 1.5 percent per annum to support liquidity for CIs, creating conditions for CIs to access low-cost funding from the SBV. The agency also lowered the ceiling deposit rates by 0.6 0.75 percent per annum for terms of less than six months; and cut ceiling short-term lending rate to priority areas by one percent per annum for, currently reaching five percent per annum to reduce borrowing costs for businesses and people.
Regarding the exchange rate management, although the international market was complicated, the foreign exchange rates and foreign currency market in the domestic remained stable with smooth liquidity. The CIs net purchased from customers and the legitimate foreign currency demands of the economy were fully and promptly met. By the end of May 2020, the reference exchange rate increased by 0.46 percent and the interbank exchange rate increased by 0.49 percent compared to the beginning of the year.
According to the SBV, under the impact of the Covid-19 pandemic, due to the low credit demand, as of May 29th 2020, the credit growth rate was 1.96 percent compared to the end of 2019.
Notably, according to the previous information of the SBV, the credit growth as of late April was 1.42%, but dropped to 1.2 percent in mid-May. Thus, the credit growth has started to rebound in the last two weeks of May, but is still at a much lower level than the same period of last year.
As of May 25th 2020, the banking sector has restructured the repayment term for nearly 224,000 customers with outstanding loans of nearly 152 trillion dong; exempted or reduced interest rates for more than 326.000 customers with outstanding loans of over 1.140 trillion dong; and offered new loans at preferential interest rates to 196,369 customers at an accumulated value of 767.607 trillion dong from January 23rd until now (interest rates popularly 0.5 2.5 percent per annum less than the rates before the epidemic outbreak).
Particularly, the Vietnam Bank for Social Policies alone has extended loans for 150,714 customers with outstanding loans of 3.813,5 trillion dong; adjusted repayment terms for 75,209 customers with outstanding loans of 1.567,6 trillion dong; and offered new loans to 680,031 customers with outstanding loans of 25.756,5 trillion dong.
