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Positive credit growth expectations


From the beginning of the year until now, credit disbursement is higher than the same period last year. The pandemic is still complicated and adversely affects many industries, but there are still some business areas that operate effectively. In addition, commercial banks are implementing the policy of promoting capital for production and business through credit support packages. These are considered the driving forces to keep the credit growth momentum this year at a positive level.

The latest data from the State Bank of Vietnam (SBV) shows that as of the end of July, credit of the whole system increased by 6.66%, much higher than the figure of about 3.5% in the same period last year. Previously, as of the end of June, the credit of the whole system increased by about 5.68% compared to the end of 2020. These are positive numbers in the context that the pandemic is still complicated.

Regarding credit growth for the whole year, according to the research team of Viet Dragon Securities Corporation (VDSC), with the policy of promoting capital for business recovery, VDSC forecasts credit growth this year at about 13.1%.

According to Maybank Kim Eng Securities Joint Stock Company, in order to support stronger economic growth, the SBV needs to promote credit growth from the fourth quarter of 2021. Therefore, the SBV may allocate more credit limits to banks, similar to 2020 when the SBV extended the credit limit twice. From that, the research team of this securities company forecasts, the credit of the whole industry would increase by 12.5% in 2021 and 14% in 2022. Banks with good capital adequacy ratio (CAR) and strong customer base are likely to be allocated higher credit limits.

Related to this, in the business survey in the third quarter of 2021 conducted by the State Bank, credit institutions forecast that the overal outstanding loans of the banking system would increase by 4.7% in the third quarter of 2021 and would increase by 13.1% in 2021, down from the expectation of 14.7% in the survey conducted in March 2021.

Mr. Can Van Luc, Director of the BIDV Training and Research Institute, said that the pandemic was complicated and affected many businesses, but there were still businesses that performed well. In addition, credit growth in the first months of the year was quite high compared to the same period last year, the management agency required credit institutions to make efforts to support production and business, so that credit disbursement may be positive in the last quarter of the year, helping the total growth rate for the whole year to reach 10 - 12%, slightly lower than the growth rate of 12.13% in 2020.

From the perspective of the monetary policy management agency, the State Bank of Vietnam of the opinion that since the beginning of the year, it has set up a target for credit growth of the whole industry in 2021 of about 12% and adjusted in accordance with the actual situation. This agency will continue to closely monitor macroeconomic, monetary, and domestic and international situation in order to appropriately administer credit in the direction of concentrating loan capital for priority areas and sectors, production and business sectors, contributing to promoting sustainable economic growth and development.


Kylie Nguyen



© 2019 Vietnam Bank for Agriculture and Rural Development No. 2 Lang Ha street, Ba Dinh district, Hanoi, Vietnam
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