SBV reviews 2021 and looks to 2022

The State Bank of Vietnam (SBV) has continued to implement solutions to control credit size and improve credit quality, Deputy SBV Governor Dao Minh Tu told the central bank’s regular press conference on December 28.

The banking industry has decided to deploy a range of solutions in order to continue to create favorable conditions for individuals and businesses to access credit, meet legitimate needs, and contribute to limiting “black credit”, such as promoting the application of science and technology, developing online services, expanding networks, diversifying products and services, reducing interest rates, and simplifying lending procedures.

Despite being negatively affected by Covid-19, credit in the entire economy increased from the beginning of 2021 and was higher than in 2020. As of December 22, credit had increased 12.68 per cent compared to the end of 2020.

The credit balance for 23 policy credit programs of the Bank for Social Policies as of November 30 reached VND245.199 trillion ($10.77 billion), an increase of 8.4 per cent.

In addition, the Deputy Governor added that credit institutions had offered favorable support to customers, such as restructuring repayment terms, exempting or reducing interest rates, and offering lower interest rates on new loans.

However, due to Covid-19, bad debts increased 0.21 per cent since the beginning of the year. On-balance sheet bad debts and unresolved debts sold to the Vietnam Asset Management Company were 3.79 per cent, and 8.2 per cent if including contingent liabilities structured according to Circulars No. 01, 03 and 14.

Regarding future plans, the Deputy Governor said the SBV will administer credit solutions to help control inflation and support the recovery of economic growth, direct credit institutions to safely and effectively grow credit, control and handle bad debts, direct credit to production and priority fields according to government policy, and strictly control credit in potentially risky areas.

The SBV will also continue to synchronously implement solutions to help individuals access bank credit and identify solutions to remove difficulties facing customers affected by Covid-19 and natural disasters.