The National Financial Supervisory Commission (NFSC) has just released a report on the economic and financial situation of the first quarter (Q1) of 2018.
Specifically, the capital mobilisation from economic organisations and individuals increased by 3 percent compared to the end of 2017 (it was 2.6 percent in the same period of 2017). In particular, mobilisation in dong (VND) rose by 3.7 percent while that in US dollar (USD) fell by 3.1 percent. The proportion of foreign currency mobilised in the total mobilisation was 9.2 percent (9.7 percent in the end of 2017).
Meanwhile, the credit grew slower than the same period of 2017. As estimated, the credit increased by 3.5 percent in Q1 2018 compared to the end of 2017, while it was 4.3 percent growth in the same period of 2017. The VND credit was estimated to grow by 3.3 percent, accounting for 91.9 percent of the total credit, while foreign currency credit growth was estimated at 5.4 percent, accounting for 8.1 percent of the total credit (7.9 percent in the end of 2017).
The medium and long-term lending has shown signs of recovery in the first months of 2018. In Q1 2018, lending on medium and long-term increased by 4.3 percent while short-term lending increased by 2.6 percent. The proportion of medium and long-term credit was about 53.2 percent (52.8 percent in the end of 2017).
The liquidity of the banking system was assessed as stable, partly thanks to the increase in foreign currency purchase of the State Bank of Vietnam and the slow disbursement of government bond fund. By the end of Q1 2018, the Lending to Deposits ratio (LDR) was 88.2 percent (87.8 percent in the end of 2017).
On the interbank market, interest rates tended to drop to low levels. By the end of Q1 2018, the average overnight rate stood at 0.83 percent (down by 0.47 percentage point compared to late 2017), while the one-week and one-month rates were respectively 0.98 percent and 1.73 percent (down by 0.9 percent and 1.2 percent compared to late 2017, respectively).
The VND/USD exchange rate remained stable and continued to be supported by the abundant foreign currency supply. As of March 29th 2018, the central reference rate was 22,463 VND per USD, up by 0.21 percent compared to the end of 2017. Meanwhile, the exchange rates offered by commercial banks increased by about 0.25 percent, and the rates on free market increased by about 0.4 percent compared to the beginning of 2018.
