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Real estate credit tightened

VietNamNet Bridge - At most banks, loans provided to the real estate sector account for no more than 7 percent of their total outstanding loans, but the figures are above 10 percent at other banks.
VietNamNet Bridge - At most banks, loans provided to the real estate sector account for no more than 7 percent of their total outstanding loans, but the figures are above 10 percent at other banks.


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The outstanding loans provided to the real estate sector in 2010-2017




By the end of the second quarter, Sacombank had VND42 trillion worth of loans provided to fund activities related to asset trading and consultancy service, most of which were real estate and real estate brokerage service.

The figure represented an increase of VND3 trillion compared with the beginning of the year. However, the ratio of the loans on the bank’s total outstanding loans had reduced from 17.6 percent to 17 percent. This was attributed to the sharp increase of VND23 trillion worth of loans in the first six months of the year.

Sacombank is one of a few banks which have loans to the real estate sector exceeding 10 percent of total outstanding loans.

The other two banks are Kien Long Bank and Techcombank, with 12 percent.

At most banks, loans provided to the real estate sector account for no more than 7 percent of their total outstanding loans, but the figures are above 10 percent at other banks.
Of the total outstanding loans of VND27.3 trillion, Kien Long Bank has lent VND3.263 trillion to the real estate sector, up by 31 percent compared with the beginning of the year. However, agriculture and industrial production are the key sectors in its credit policy.

As for Techcombank, by the end of June, its total outstanding loans had reached VND166.7 trillion, including VND20 trillion disbursed for the real estate sector.

For many years, real estate has been the biggest lending segment, accounting for 15 percent of total outstanding loans on average. 

BIDV is also among the biggest lenders with VND37.5 trillion having been disbursed to the real estate sector. However, the figure only amounts to 4.2 percent of its total outstanding loans.

Real estate credit once accounted for a very high proportion, over 30 percent, in banks’ total outstanding loans in 2007-2008. However, warned about the high risks in relying on real estate credit, banks have cut the proportions to 5-7 percent.

A report showed that the credit had grown by 6.16 percent by June, while real estate credit had increased by 2.19 percent only. The lending to the real estate sector now accounts for 7.5 percent of the total loans, much lower than the 15.8 percent in 2017 and 17.1 percent in 2016.

In Hanoi, real estate outstanding loans reached VND114 trillion in the first half of the year, accounting for 7.6 percent. As for HCMC, the figure was 10.6 percent.

The central bank wants to curb the credit growth rate at 17 percent this year and control lending to the real estate sector. Commercial banks have raised the lending interest rates by 1-2 percent per annum.


US$1=VND22,000


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