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Banking & Finance

SBV sets limits for banks

Released at: 16:51, 10/07/2015

SBV sets limits for banks

Central bank sets maximum credit growth and outstanding credit for local banks and foreign bank branches.

by Hung Nguyen

The Governor of the State Bank of Vietnam (SBV), Mr. Nguyen Van Binh, has issued a document on credit growth for 2015 at a number of Vietnamese commercials bank and foreign bank branches.

The SBV has set maximum credit growth for the banks. Vietinbank’s growth has been set at 16 per cent, Vietcombank 16 per cent, SeABank 35 per cent, TPBank 35 per cent, Techcombank 30 per cent, LienVietPostBank 30 per cent, VPBank 18 per cent, Nam A Bank 25 per cent, SHB 15 per cent VIB 20 per cent, BaoVietBank 36 per cent, NCB 24 per cent, Co-op Bank 20 per cent, BIDC Hanoi Branch 30 per cent, and BIDC Ho Chi Minh City Branch 30 per cent.

Regarding foreign banks branches in Vietnam, the document has set the maximum credit growth for the Taipei Fubon Bank Binh Duong Branch at 20 per cent, Standard Chartered Bank Vietnam 30 per cent, and Korea Exchange Bank Hanoi Branch 30 per cent.

The SBV also set maximum outstanding credit at some foreign banks to December 31. The limit for Kookmin Bank Ho Chi Minh City is VND1.95 trillion ($89.4 million), Woori Bank Ho Chi Minh City Branch VND3.99 trillion ($182.94 million), Overseas - Chinese Banking Corporation Ho Chi Minh City Branch VND344 billion ($15.77 million), DBS Bank Ho Chi Minh City Branch VND1.05 trillion ($48.14 million), Taipei Fubon Bank Hanoi Branch VND1.5 trillion ($68.77 million), Bank of Tokyo Mitsubishi Hanoi Branch VND6.89 trillion ($315.9 million), Industrial and Commercial Bank of China Hanoi Branch VND4.48 trillion ($205.4 million), PNP Paribas Bank Ho Chi Minh City Branch VND5 trillion ($229.25 million), Citibank Ho Chi Minh City Branch VND2.79 trillion ($127.92 million), and Taipei Fubon Bank Ho Chi Minh City Branch VND2.90 trillion ($132.96 million).

The SBV also requires that credit growth at banks is appropriate to capital capacity, follows capital adequacy ratio (CAR) requirements, and foreign exchange and risk management to minimize the occurrence of non-performing loans.

It also suggested banks provide credit to the manufacturing sector and especially to agriculture in rural areas, exports, support industries, small and medium-sized enterprises, high-tech equipment enterprises, and enterprises with promising business plans and high profit potential. They must also exercise caution when lending to sectors such as real estate, as the repayment term can be quite long.

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