Monday, August 8, 2011

Transfer USD to VND to lower lending rates

Transfer USD to VND to lower lending rates
The bank converted USD to VND lending interest rate of 15% - 16% / year will be better. Until now, about 6-7 banks do support this transition.
The fact of the business (DN) of Vietnam is 60% - 70% owned manufacturing business based in the bank. But interest in the problem situation is currently difficult for many enterprises, especially SMEs. DN "soft" capital but dare not because of high interest loans, faced with survival.

The reporter spoke with Nguyen Hoang Minh, Vice Director of State Bank branches in HCMC, on issues related to the bank - capital - DN.

Sir, with interest rates higher than 20%, DN dare not for profit loan production business with the bank rate. This is a hot issue since early this year, no bank would not move to solve anything?
6 months, the State Bank of Vietnam (SBV) has focused aggressively implement five key tasks is to control credit growth should not exceed 20% declining balance of loans of non-production down 22% (times 30-6) and last year to less than 16% management of foreign exchange markets, gold stable stable and safe in the bank guarantee loan rates reasonable and to promote production and business. The results were very positive.

Specifically, mobilizing the whole region in six months increased 4.2% over the year, reaching 840,000 billion. In particular, funding increases 5.29% VND and foreign currencies up 0.94%. Higher balances in USD USD show the effectiveness of policies implemented to reduce interest rates to 3% in U.S. dollars, so people have converted to USD USD to send interest rates higher.

As he said, raising capital increased 4.2% and Resolution 11 was limited to non-productive loans, but the production company is called "soft" capital, so funds raised go?

Mobilized capital increased 4.2%, but credit growth to 6.02% - equivalent to 46,000 billion. Sources of this growth mainly to the production and trade with priority order include: producing goods for export, imports of essential goods; generate capital for SMEs; agriculture areas.

And indeed, as reported by the banks, outstanding non-current production is only about 17% of total loans. Growth of bank credit of less than 20% also meet the requirements of Resolution 11.

But sir, if the numbers lending rate as well as credit growth is not reliable. Since before the time of 30-6 days, many banks have loans of up to 26%, but they were down 30-6 right 20% ...

To answer this, we will have to inspect and test. The bar, this test is we put the task in six months.

USD: raise a contract for the loan to 18!

VND interest rates as too high, companies complain the hand touched the bank loans is true, correct sir?

As I said, the credit growth rate higher than the rate of increase of capital raising. And indeed, the early months of the VND interest rates high, companies have turned to borrowing in dollars with lower interest rates. So figure six months of debt in USD increased by 1.5%, while loans in foreign currencies rose to 18.09%.

While raising capital in foreign currencies six months increased less than 1%, but foreign currency loans increased by 18% - 18 times, this will put pressure on rates. Is the exchange rate will be "trouble" again as before not, sir?

Because the demand for loans in foreign currency of the company more than it is now the responsibility of the central bank is to reduce the stimulus of foreign currency to reduce the pressure on rates.

So, in May last SBV issued Circular 07 subjects adjusted for foreign currency loans of the bank to pay for imported goods and services and short-term loans to importers.

According to my estimates, if done well it makes it possible to reduce to 30% for foreign currency, to avoid pressure on the exchange rate as before.

Award "difficult problem" of capital for business

Sir, the reason the issue that the public burning of rising interest rates, businesses do not borrow capital from banks is "rip fence" interest rates should push up interest rates. He explained how about this?

In fact many banks are still over 14% interest rate cap / year, raising to 18% - 19% / year have made the interest rate rise. But in addition to high interest rates, remains a cause of SMEs do not borrow funds because the company lacks a statement of assets, financial reporting ...

But the role of state management in this area, City State Bank branches shall have to cut interest rates in accordance with and "solve difficult" in terms of capital for corporations but, sir?

We had a plan and solve this difficulty. To reduce interest rates, in the spirit of support, sharing problems with businesses, we also worked with some of the banks have strength in foreign currency trading, they strongly suggested the conversion of foreign currency into VND for loans with reasonable interest rates.

Because interest rates under control input 3% / year, while interest rates VND to 14% / year, so banks convert USD to VND lending interest rate of 15% - 16% / year will be more profitable. Until now, about 6-7 banks do support this transition.

But those companies lack the processing records, financial statements, lack of collateral ... we coordinate with the credit guarantee fund for SMEs to facilitate this object to bank loans . Through guarantee funds, they will be better supported loans. We are also proposed to City People's Committee to fund additional capital guarantee.

Handling the big banks "forced" small bank!

Solving the shortage of capital is praiseworthy, but to address the violations based on interest rates to decrease interest rates, I think needs a more radical solution. He has proposed, what proposals do not solve this problem?

We have a number of recommendations to strengthen central bank control over the market 2 (ie, mutual lending market between banks) in terms of quantity, rate, because formerly the central bank does not control this. If so, to ensure the possibility of lower interest rates. Because many banks on the market two mutual-interest loans of up to 27% - 28%.

Therefore, if banks have no opinion will cause market manipulation. Last time, several major banks have no credit growth, focus on the lending market 2, and no interest is to be restricted.

Do small banks not subject to floating interest rate, new small banks should seek to raise interest rates up. So we proposed to control this, avoid loose.

Simultaneously, we also propose the State Bank increased interest rates, increased scale, expanded loan refinancing for small banks to cover liquidity. The goal for the central bank to lend more to small banks, small banks avoid lending to higher interest rates in the market 2.

Our statistics, the first 6 months of payment (money issue and circulation of deposits in foreign currencies or Vietnam dong) by our bank manager to increase less than 3%, much lower than Resolution 11 allows up to 16%. Thus, we have the conditions to expand lending. Copyright @ 2011 - Theme by NanLimo - Thanks to Google