Hong asked credit institutions to control cash flow, step up lending to fund people’s home purchases, collect debts from home sellers, and manage risks of credit provided to high-end real estate which has an oversupply. 

Hong also asked SBV’s local branches and commercial banks to control risk with large businesses, clients related to large shareholders, people related to shareholders of credit institutions, and cross-ownership status. 

It is necessary to provide credit in a reasonable way and control credit to businesses and economic groups that have back-door projects.

“This is an extremely important issue. It will be very risky for banks if credit concentrates on back-door enterprises,” Hong said, adding that SBV inspectors have issued many warnings recently.

She urged tighter control of credit, especially to enterprises that have issued bonds that are about to mature.

According to the Governor, management agencies will apply measures to ensure macroeconomic stability. In some cases, the policies may affect business operations.

In other countries, enterprises with a large scale have a division in charge of watching and analyzing macroeconomic performance. They can predict trends in the world and government policies.

“If Vietnamese enterprises do this, they won’t be passive in their production and business,” Hong said.

“I have heard from the leaders of the Ministry of Construction (MOC) that one enterprise attending the conference is implementing more than 50 projects at the same time. I wonder if they can continue to manage to do this if difficulties appear,” she said. “What are the solutions to settle difficulties?”

She said real estate firms developing projects with borrowed money, especially ones using high leverage ratios, must attach importance to cash flow administration.

“Maybe enterprises have many projects and the projects have high value. But it won’t be easy to convert the projects into cash when they need money promptly,” Hong said.

“If you borrow money from 10 lenders at the same time, and the 10 lenders ask you to pay debts at the same time, you will fall into difficulty, not to mention implementing many projects at the same time,” she said.

She said that enterprises need to improve their financial capability and diversify capital mobilization sources to ease reliance on bank loans. 

Duy Anh