Outstanding credit balance in Hanoi is higher than the national growth rate

According to the State Bank of Vietnam (SBV), as of the end of August 2023, outstanding credit balance in Hanoi is estimated at over VND 3.2 million billion, an increase of 10.35% compared to the end of 2022 (higher than the national growth rate: 5.56%, higher than the growth rate of the Red River Delta region of 8.35%); the city's credit scale ranks second nationwide, after Ho Chi Minh City.

Sharing at the Conference "Connecting banks - enterprises in Hanoi", Ms. Ha Thu Giang - Director of the Department of Credit for Economic Sectors of the State Bank of Vietnam said that although the banking sector has made efforts to implement policies and solutions, many of which are implemented with the resources of credit institutions, the provision and access to credit of enterprises nationwide in general and in Hanoi in particular are still facing many difficulties and challenges.

In the context that other capital mobilization channels have not really been effective, the capital market (corporate bond market, stock market) still has some problems and has not developed commensurate with its role in providing medium and long-term capital for the economy, causing capital demand for economic recovery to be concentrated mainly through the bank credit channel, creating pressure on the banking sector to supply capital mainly for the economy.

Finance - Banking - Credit balance in Hanoi is higher than the national growth rate — Ms. Ha Thu Giang - Director of the Department of Credit for Economic Sectors, State Bank.

The representative of the State Bank said that the credit growth rate of the whole system is still low compared to the same period of previous years, mainly due to objective factors such as: Demand for investment, production, business, and consumption has decreased; Some customer groups have demand but have not met the loan conditions, especially the group of small and medium enterprises.

In addition, the cause is also due to the impact of the credit absorption capacity of the real estate group; After a period of economic difficulty, the risk level is assessed higher, when it is difficult to prove the effectiveness of business operations; Credit institutions have difficulty in lending decisions because they cannot lower credit standards.

From the above situation, to contribute to promoting production and business in Hanoi, in addition to the solutions of ministries, branches and localities, Ms. Giang added more solutions in the coming time.

First, continue to implement solutions to manage monetary policy and banking activities with the aim of controlling inflation, stabilizing the macro economy, supporting economic growth at a reasonable level, and linking bank credit investment to implementing programs and projects according to the City's planning.

Credit focuses on production and business sectors, priority sectors; growth drivers; consider giving priority to granting credit according to the Green Classification List, lending to meet people's housing needs, social housing projects, worker housing, and low-cost commercial housing projects.

Second, continue to implement solutions to remove difficulties, support customers, direct credit institutions to actively implement the tasks of the banking sector in the Socio-Economic Recovery and Development Program, focusing on the 2% Interest Rate Support Program through the commercial banking system; specific credit programs and policies for a number of industries and sectors (120,000 billion VND credit program for loans for social housing, workers' housing, etc.; loans for forestry and fishery sectors, etc.).

Credit control for potentially risky areas such as real estate, securities, BOT and BT traffic projects; credit quality control and bad debt prevention.

Finance - Banking - Outstanding credit balance in Hanoi is higher than the national growth rate (Figure 2). — Conference Overview.

Third, create favorable conditions for customers to access credit, direct credit institutions to continue to reduce costs, increase digital transformation, apply technology and other solutions to create conditions to continue to reduce lending interest rates for both new loans and existing outstanding loans; review and cut fees to create more favorable conditions for businesses and people;

Proactively develop credit programs and products with reasonable interest rates, flexibly meeting the needs of many customers and segments; Continue to review and simplify internal processes and procedures to facilitate customers' access to and absorption of capital.

Implementing solutions to remove difficulties for customers borrowing capital in various fields and industries, including the policy of restructuring debt repayment terms and maintaining debt groups according to the provisions of Circular 02 dated April 23, 2023 is the fourth point.

Fifth, promote the bank-business connection program to enhance information, grasp needs, promptly handle problems in credit relations, and create favorable conditions for people and businesses to access credit capital.

Finally, consolidate and develop the banking network and services in accordance with the socio-economic development needs of localities. Simplify procedures in transactions with customers to improve access to credit capital and banking services for businesses and people in the area.

At the Conference, the support of the banking industry was acknowledged. However, in the context of many economic difficulties, businesses expressed their support for banks to have more flexible mechanisms and continue to reduce interest rates to soon restore production and business activities .

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