return icon

Credit demand set to grow in the final half of 2022

In the last half of 2022, banks may ease loan conditions so that more customers could access credit, given the positive economic outlook and their improving financial capacity.

Credit demand in the economy is set to keep growing during the last half of 2022 in all economic sectors.

The finding was revealed during a survey conducted by the Forecast and Statistics Department under the State Bank of Vietnam (SBV) in June on the credit situation at local banks.

During the first six months of 2022, Vietnam’s credit growth expanded by 9.35% year-on-year, significantly higher than the 6.47% rate recorded for the same period of last year.

This resulted in a total outstanding loan of VND11,400 trillion (US$487.32 billion).

According to the SBV, the majority of banks maintained their view of a higher credit growth as stated in the previous survey, in which credit demand from businesses would be higher than individual customers; demand for short-term credit equivalent to demand for mid- and long-term ones; and the need for VND-denominated loans higher than foreign currency-denominated loans.

The SBV also noted consumer credit is expected to expand at highest among others, followed by credit for trade, services, construction, and industrial development.

Meanwhile, banks suggested credit for agro-forestry-fishery development would be the lowest.

This year, the SBV sets a credit growth target of 14%, around the same level of last year, but noted it reviews the respective credit quota for each bank  based on their operation situation and finance capacity.

A 14% credit growth would mean only VND500 trillion ($21.3 billion) would be disbursed for the remainder of the year, lower than the VND1,000 trillion ($42.7 billion) injected into the economy during the first half of 2022.

The SBV noted it would continue to encourage credit into priority economic fields and individual customers and tighten loans to risky sectors such as securities, real estate, or insurance.

For the last half of 2022, the survey forecast banks may ease loan conditions so that more customers could have access to credit.

“This comes as the banking sector holds an optimistic outlook on the macro-economic situation, their improving financial capacity, and the vision of the Government to support socio-economic recovery,” noted the report.

A report from SSI Securities Corporation estimated the average profit growth of Vietnamese banks during the last six months at 26-29% year-on-year, thanks to high credit growth and improving net interest margin (NIM).

SSI expected the main drivers for credit growth during the last half of 2022 would come from long-term loans in the fields of infrastructure development, manufacturing, education, healthcare, and electricity transmission.

The securities company forecast Vietnam’s credit growth in 2023 to slow down compared to 2022 and return to the pre-Covid-19 level of 13%.

While consumer credit may decline due to low consumer demand, the situation would be different for businesses in manufacturing, production, and infrastructure, as over VND1,200 trillion ($51.3 billion) would be channeled into the economy via the Government’s 2%- interest rate subsidy scheme for the 2022-2023 period.


Vietnam to attend ASEAN Tourism Forum 2023 in Indonesia

Vietnam will participate in ASEAN Tourism Forum (ATF) 2023 themed “ASEAN: A Journey to Wonderful Destinations”, and the Travel Exchange (TRAVEX) trade fair in Yogyakarta, Indonesia from February 2 – 5.

Hanoi and Ho Chi Minh City among safest cities in Southeast Asia

Hanoi and Ho Chi Minh City have both been included in a list of the safest cities in Southeast Asia, as compiled by statistics site Numbeo.

Action plan issued to accelerate national anti-corruption strategy building

Deputy Prime Minister Le Minh Khai, head of the steering committee on building the national anti-corruption strategy by 2030, has signed a decision on the issuance of the committee’s action plan.


Latest guidance on one-way money transfers from Viet Nam

HCM City proposes removing hindrances to develop real estate market

Ho Chi Minh City authorities made a proposal to clear bottlenecks for healthy and sustainable development of the real estate market.

More high-value foreign investment projects needed as tax policies change

Vietnam needs to improve FDI quality, attracting high-tech projects that promise to bring higher added value.

Khmer's ginger cake of love and faithfulness

The ginger cake of the Khmer ethnic group in Soc Trang Province is a beloved traditional treat that is often offered to ancestors on important anniversaries such as the Tet (Lunar New Year) festival.

HCM City promotes digital transformation in education

Digital transformation is considered key to improving education and training quality, as proven by the effect of HCM City actively applying digital transformation over the past five years.

Hanoi to close fruit shops lacking proper food safety preparations

The capital city of Hanoi encourages the expansion of safe fruit businesses while clamping down on fruit shops that do not comply with food safety protocols, specifically street vendors.

Dutch diplomat donates Vietnamese paintings to national museum

Vietnam National Fine Arts Museum has received two paintings from former deputy ambassador Ellen Berends of the Netherlands to Vietnam.

Hanoi's unique rice cooking contest in photos

On the 8th day of the first lunar month each year (January 29, 2023), Thi Cam village in Hanoi’s Nam Tu Liem district holds a rice cooking contest.

Hanoi proceeds with park revitalization program

The implementation of Hanoi leaders’ promise to revive parks has begun: admission to Thong Nhat Park is now free after the removal of the fence, and Con Coc Flower Garden has a new look. However, there are still many things that need to be done.

Vietnamese farmers on board the ‘digital agriculture train’

In the digital era, next-generation farmers can fertilize and water their fields in Binh Phuoc from afar, even in a different country.

Vietnam forecast to become second-largest economy in Southeast Asia by 2036

2023 is predicted to be the year of many challenges for the Vietnamese economy due to the gloomy outlook of the global economy and multiple crises.

Prenn Pass leading to Dalat to be closed for expansion

Vehicles will be banned from using the seven-kilometer-long Prenn Pass to travel to Dalat City as work on the pass upgrade and widening project begins on February 6.