The State Bank of Vietnam has repeatedly said that the allocation of credit growth targets to each bank is based on a number of basic criteria such as credit institution ratings, credit concentration, interest rates, participation in financial support. handling weak credit institutions, the actual situation of the market, etc.
The State Bank of Vietnam (SBV) recently said that it has adjusted the credit growth target in 2023 for banks to provide more credit capital to promptly meet the needs of the economy.
Specifically, on July 10, 2023, the SBV increased the credit limit assigned to the whole system to about 14%. Previously, at a press conference held at the end of June, Deputy Governor Dao Minh Tu said that in February, the agency had assigned the credit target to commercial banks at 11%.
With the credit balance of the whole economy at the end of 2022 at VND 11,924 million, 3% of the credit growth limit was assigned to the credit institution system, corresponding to a scale of nearly VND 358,000 billion.
According to the State Bank, the allocation of “room” this time helps banks promptly provide more credit capital for the economy. This move is part of the operator’s efforts to remove difficulties for production and business under the direction of the Government in the context of lower-than-expected economic growth in the first 6 months of the year.
Talking to the writer, the leader of a joint stock bank confirmed that the State Bank had just opened the credit room. The specific number was not disclosed, but the leader said the increase depends on the quality and credit structure of each bank.
Currently, there is no detailed information about the newly adjusted credit room of each bank. However, the State Bank has repeatedly affirmed that the allocation of credit growth targets to each bank is based on a number of basic criteria such as the latest results of credit institution rating scoring as prescribed in Clause 1 of this Article. Circular No. 52/2018/TT-NHNN dated December 31, 2018 (amended and supplemented), credit balance for 100 customers with the largest outstanding balance, interest rate, participation in support assist in handling weak credit institutions (weak banks, weak people’s credit funds), market realities….
In Directive 01 issued at the beginning of the year, the SBV also said that it would notify and periodically review and adjust credit growth targets for each bank on the basis of its operation situation and financial capacity. and healthy credit growth; which is based on some basic criteria such as credit institution ratings, credit concentration, interest rates, participation in supporting handling of weak credit institutions, market realities, etc.
Simultaneously, the SBV will also direct credit institutions to increase credit throughout the year at a reasonable rate, directing credit to production and business fields, priority fields and economic growth drivers according to the principles of economic development. Government policy; ensure safe and effective credit operations; continue to strictly control credit in potentially risky areas; create favorable conditions for businesses and people to access bank credit capital.
The credit ceiling control mechanism for commercial banks has been applied by the State Bank since 2011. Every year, the SBV usually considers granting the first credit limit based on the growth orientation to banks in the first quarter based on the growth orientation. , and then make adjustments to match operating goals.
In 2022, the SBV also granted an initial credit room to banks in the first quarter and made three adjustments to the credit growth limit for banks in the last months of the year.
In 2023, the State Bank said, the credit growth orientation will be around 14-15%, with adjustments in line with the actual situation. This target is slightly better than the initial orientation of 2022 (14%). Even if conditions are favorable, the credit limit will be adjusted more.
In February, the SBV granted the first credit limit to banks. According to aggregate data of VnDirect Securities, in the first phase, MSB was granted the highest credit “room” at 13.5%; HDBank is granted a “room” of 11%, ACB (9.8%), Vietcombank (9.8%), VIB (9.5%), Techcombank (9.5%), TPBank (9.1%). VPBank (9%), MB (9%), BIDV (8.3%), LienVietPostBank (8%).
VnDirect said that these banks have diversified credit portfolios, participated in supporting weak credit institutions, healthy asset quality and abundant liquidity such as Vietcombank, ACB, HDBank, etc. In which, MSB has the best credit limit, mainly due to its much lower loan-to-deposit ratio (LDR) compared to other banks.
Source: CafeF
