The State Bank assigned the entire credit limit to banks at the beginning of the year with the growth target for the entire system in 2024 being 15%.
The State Bank will send this credit limit allocation to credit institutions on December 31, 2023.
Accordingly, the credit growth target this year is about 15%, with flexible adjustments to suit reality. Last year, the credit growth target was 14-15%, but the actual results as of December 21 were about 11%.
"To facilitate credit institutions to supply capital to the economy , the State Bank assigns all credit growth targets and requires banks to control the whole year according to regulations," the document stated.
This year, based on actual developments, the regulator will set a target for credit growth and proactively adjust the limit (room) for each bank, without requiring them to submit additional requests.
This is a difference in the State Bank's credit management compared to previous years, which usually involves many phases and requires banks to submit proposals. A bank leader said this positive point helps them proactively plan their business plans for the whole year.
Transaction at a joint stock commercial bank. Photo: Thanh Tung
The formula for calculating growth targets for each bank is based on input factors by the State Bank, including: outstanding credit balance in 2023, rating score in 2022, outstanding credit balance sales in 2024 and unrecovered money.
Credit institutions, except for 100% foreign-owned banks and joint venture banks, must not exceed the prescribed credit balance at any time during the year. As for 100% foreign-owned and joint venture banks, the credit balance at the end of 2024 must not exceed the granted level.
In addition to the limit, the State Bank also strictly prohibits the granting of credit in violation of regulations, granting to the board of directors, executive board and related persons of credit institutions, enterprises in the ecosystem, backyard enterprises... with preferential interest rates while people and enterprises with legitimate and legal needs have difficulty accessing capital. The operator also requires banks to continue to maintain stable deposit interest rates and strive to reduce lending interest rates.
The change in the State Bank's credit management took place after the Prime Minister repeatedly issued telegrams on pushing capital into the economy.
At the end of November 2023, the Prime Minister requested the State Bank to learn from its slow credit management in 2022. According to him, credit growth management needs to be timely and effective, ensuring adequate credit supply for the economy and the safety of the credit institution system, absolutely not allowing congestion, stagnation, delay, or untimely occurrence.
Quynh Trang
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