Banking Industry - A Helping Hand for Business Development

10:14:11 AM | 4/12/2020

Over the past years, the State Bank of Vietnam in Thai Nguyen province (SBV Thai Nguyen) has been proactive and flexible in management, helping the system of banks and people's credit funds constantly develop. Vietnam Business Forum had an interview with Mr. Bui Van Khoa, Director of SBV Thai Nguyen. Nguyen Dung reports.

Could you please tell us about the contributions of the banking sector to the overall economic development of the province in the 2016-2020 period?

In recent years, Thai Nguyen banking industry has become stronger, making many important contributions to the local socio-economic development. SBV Thai Nguyen, with the function of advising and assisting the Governor of SBV in implementing the state management of money, banking and foreign exchange activities in the province, has well deployed monetary and credit policies to credit institutions (CIs) in the area. Credit expansion has gone hand in hand with credit safety and quality, ensuring capital supply for production and business sectors, priority sectors, and favorable conditions in accessing bank capital. The period 2016-2020 has continued to be a successful period in operating monetary policy of SBV in general and the banking system of Thai Nguyen province in particular. The mobilized capital of CIs records an average growth of 18.76%/year; the average growth rate of credit outstanding balance is 13.31%/year; the efficiency of credit flows has been improved, contributing to support economic growth. NPL ratio is maintained at about 1%/total outstanding loans, below the banking industry average. Credit structure focuses mainly on production, business, trade and services (80%); consumer loans (18%), real estate loans, securities and construction of bridges (2%), which are in line with the local socio-economic development policy.

By the end of September 30, 2020, the mobilized capital reached VND73,200 billion, an increase of 11.87% compared to December 31, 2019. It is estimated that by December 31, 2020, the mobilized capital will reach VND77 trillion, up 17.67% compared to December 31, 2019. The outstanding loans to the economy as of September 30, 2020 reached VND60,600 billion, up 6.03% compared to December 31, 2019. It is estimated that by December 31, 2020, the outstanding loans will reach VND63 trillion, up 10.23% compared to December 31, 2019. Bad debt is controlled under 1%/total outstanding loans.

The banking sector has concretized and synchronously implemented solutions on monetary, credit, banking and foreign exchange policies; deployed credit solutions quickly and flexibly; positively transformed the credit structure with a focus on production - business activities to help businesses to stabilize and develop. Local banks have synchronously implemented many solutions to remove difficulties for businesses, striving to achieve the credit growth target, contributing to the GRDP growth of Thai Nguyen province.

The operation network of CIs in the area in the past five years has been widely developed, covering all 180/180 communes, wards and towns of the province, and banks have focused on expanding the network to rural areas to promote lending to rural development.

Regarding products and services, banks have innovated and applied information technology with many products and services suitable to customers' needs. They have supplied many new products to increase convenience for customers such as: increasing the utility of personal accounts, developing e-banking services, ATMs, products on mobile phones, bank card payment via devices accepting cards contributing to promoting non-cash payment in residential areas.

What are the top goals, the priority fields that the provincial banking sector will focus on in the coming time?

We will continue to closely follow the goals, orientations and directions of the Government, SBV and the Provincial Party Committee and Provincial People's Committee to direct CIs to implement solutions to remove difficulties, promote production and business development, effectively supply capital for the economy to contribute to the economic growth. It will continue to direct CIs to effectively implement solutions to remove difficulties for customers affected by Covid-19 such as rescheduling debt repayment terms, exemption and reduction of interest according to Circular 01, reducing operating fees to save resources for new loans with preferential interest rates to support and accompany businesses to overcome difficulties. We will focus on loans for production and business sectors, priority sectors, and bank-business connection program. We will summarize and evaluate the implementation of Project 1058 as a basis for construction of Project on restructuring the system of CIs for the period 2021-2025; direct CIs to develop electronic payment activities, contributing to promoting non-cash payments in the area.

Source: Vietnam Business Forum