Credit Growth +12.97%, M2 +12.96% in Jan-Jul: Vietnam Central Bank
Total outstanding loans of local banks rose 12.97% in the first seven months of 2010, compared to the full-year target of 25%, according to Governor Nguyen Van Giau of the State Bank of Vietnam, the country’s central bank.
The country’s broadest measure of total money supply, M2, grew 12.96% from end-2009 while total deposits were up 16.3%, Giau told.
The increased deposits signal a trend that local residents still select to deposit their idle money at commercial banks even though the savings interest rates fall to around or even below 10% per annum from current average rate of 10.49%, he said.
Giau added that depositors can receive a real positive interest rate of between 1% and 2% per annum as the country’s consumer price index is likely to be kept at below 8% this year, including a rise of 4.84% in Jan-July.
The central bank is taking drastic measures to slash deposit and lending interest rates to around 10% and 12%, respectively, to help boost domestic economic growth.
The SBV is taking measures to bring down interest rates to help boost local production.
The central bank estimates in early June that credits and deposits at local banks were up 10.52% and 10.82% in H1 versus 17.01% and 16.2% in the same period last year, respectively. (Liberated Saigon)
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