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Basic interest rate to be stabilised: Governor
Governor of the State Bank of Vietnam Nguyen Van Giau has affirmed that the basic interest rate will be stabilised in the upcoming months, putting an end to the rumour about a possible basic interest rate adjustment.
Giau affirmed the policy on stabilising the basic interest rate when talking to the press on the sideline of a dialogue between banks and businesses held in HCM City several days ago.
With the information, businesses can feel secure in accessing loans to push up their production and business, as the interest rates will not see big changes in the time to come.
In the market, deposit interest rates are tending to increase while the basic interest rate remains unchanged. What would you say about that?
The move by commercial banks recently to raise deposit interest rates should be seen as a good sign for the national economy. This means that the demand for capital, especially VND capital, has been increasing sharply, which has forced banks to raise deposit interest rates to lure idle capital. The deposit interest rate increases are nothing to worry about. Higher deposit interest rates benefit depositors, thus helping mobilise idle money for production and business.
Will the basic interest rate be adjusted in the coming months?
The interest rate policy needs to be based on supply and demand. Though the world’s economy still shows a lot of uncertainties, Vietnam’s market economy in the last two months remains stable. It is likely that the basic interest rate will be stabilised in the upcoming months. Therefore, businesses can have peace of mind about interest rates when they access bank loans.
Some experts say that when credit grows there are latent risks of high inflation. Do you think it is worth worrying about with the current credit growth rate?
The VND capital mobilisation and outstanding loans of the banking system in the first four months of the year both saw considerable growth rates, higher by 10 percent than the end of 2008.
I think that if the world’s and domestic situation remains stable, Vietnam may increase the credit growth rate target by a little over the previously set goal of 21-23 percent.
With the current credit growth rate, I cannot see any worrying problems. However, commercial banks need to have good risk management measures and be wary of bad debts.
Businesses complain that they are having difficultly accessing loans under the interest rate subsidy programme, though they are listed as the targets of the policy. What are your thoughts?
Businesses always want to get loans with the lowest possible interest rates and easiest lending procedures. Meanwhile, banks always try to find good businesses to lend capital to. Therefore, banks and businesses need to closely cooperate to find a common voice.
VietNamNet, DTCK
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