The State Bank of Vietnam (SBV) will require commercial banks support high-tech agriculture enterprises, under a direction from Deputy Prime Minister Vuong Dinh Hue. At a meeting with ministries to discuss the implementation of the Prime Minister's directive on a VND100 trillion ($4.39 billion) credit package for high-tech agriculture on March 23, Deputy Prime Minister Hue spoke of the importance of the credit package for agriculture and rural development and for the agricultural development policy within a Resolution from Party Congress and a Resolution from the National Assembly and the government. “Enterprises and citizens agreed when the government announced this program,” the Deputy Prime Minister said. “Therefore, ministries must carry out the program seriously.” Although there is a legal framework for the development of high-tech agriculture, in order to create a unified framework, Deputy PM Hue assigned the SBV Governor to issue a decision … [Read more...] about Central Bank of VN tells commercial banks to support high-tech agriculture
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VN banks to face interest margin challenges: SSI
Analysts of the Retail Research and Investment Advisory Division at Saigon Securities Incorporation (SSI) have predicted 2017 will be a challenging year for banks to increase their Net Interest Margin (NIM). NIM is the ratio of net interest income to invested assets, with the net interest income being the difference between interest income and interest expense. According to the division, competitions among banks, compliance with Circular 06 and the government’s effort to maintain low lending interest rates are factors that may have an impact on the NIM ratio. Circular 06 issued by the State Bank of Viet Nam requires banks to reduce the proportion of short-term deposits used to provide medium and long-term loans from 60 per cent to 50 per cent this year. To meet the requirements, it is likely that banks would have to raise more medium and long-term savings and reduce long-term loans which would cause the loan-deposit ratio (LDR) and NIM to decrease. To mobilise more savings, … [Read more...] about VN banks to face interest margin challenges: SSI
Nhandan Newspaper – World Bank chief praises Vietnam’s reforms to support businesses
Georgieva told the media on March 23 that the bank was pleased with the progress that is being made to create conditions for start-ups and small and medium-sized enterprises to flourish and to increase in numbers and presence in Vietnam. Earlier the World Bank CEO met Prime Minister Nguyen Xuan Phuc and discussed Vietnam’s state-owned enterprise, financial sector and taxation reforms, as well as efforts to increase domestic resources mobilisation and ensure better conditions for the private sector to be an engine of growth. She said if Vietnam wanted to sustain high growth rates of 6-6.5% in the future, it had to continue with protecting macroeconomic stability and advancing reforms that can increase productivity and support growth. Georgieva said the government should pay close attention to strengthening the predictability of the regulatory environment, transparency and conflict resolution mechanisms, stressing that governance reforms are relevant to not only businesses but also … [Read more...] about Nhandan Newspaper – World Bank chief praises Vietnam’s reforms to support businesses
World Bank continues to cooperate with Vietnam
(VOVworld) - Prime Minister Nguyen Xuan Phuc received World Bank (WB) CEO Kristalina I. Georgieva in Hanoi on Thursday, praising the bank’s role in Vietnam’s socio-economic development, especially in poverty elimination. He said that in addition to promoting economic growth and ensuring social welfare, Vietnam will focus on building a solid institutional foundation serving as the basis for realizing the set orientations and strategies of its five-year development plan. The top targets are to stabilize the macro-economy, exploit strategic breakthroughs, restructure the economy while reforming the growth model, ensure social welfares, respond to climate change, and try to maintain an average growth rate of 6.5–7 percent between 2016 and 2020. He said he hopes Vietnam will continue to receive assistance from sponsors, including the WB, to help it achieve its targets in the course of integration and economic development. Georgieva underlined the WB’s willingness to … [Read more...] about World Bank continues to cooperate with Vietnam
Some banks in Vietnam enter new rate race
Some commercial banks have entered a new interest rate hike race to lure medium- and long-term deposits, pushing the rate to a record high of more than 9 per cent per year. VietA Bank has also listed a high rate of 8.2 per cent per year for certificates of deposit with tenure of just six to 18 months. The rate at Sacombank is also at 8.2 per cent per year; however, it is applicable for certificates of deposit with tenure of 5-7 years. The rate is much higher than the average deposit interest rates offered by other commercial banks. Currently, State-owned commercial banks offer a rate of 6.5-6.8 per cent per year for long-term deposits, while it is 7-7.5 per cent at large-sized joint stock commercial banks and 8-8.2 per cent at small-sized banks. Analysts attribute the hike to factors such as the need for medium- and long-term funds to grow lending this year. Many experts anticipated the scenario and warned there would be rising demand for long- and medium-term funding after they … [Read more...] about Some banks in Vietnam enter new rate race