Tuesday, December 11, 2018 11:45:36 AM - Markets open
VN-INDEX 953.40 -2.49/-0.26%
HNX-INDEX 106.53 -0.29/-0.27%
UPCOM-INDEX 53.27 -0.08/-0.14%
Forex lending to continue next year
VietnamPlus - 11/28/2018 1:36:00 PM
 (0 ratings. You must sign in to rate.)
The State Bank of Vietnam (SBV) is drafting a new circular on foreign currency lending, allowing credit institutions and foreign bank branches to extend loans to some borrowers in 2019 instead of cutting them off at the end of this year as planned.
Under the draft circular, which aims to revise Circular 24/2015/TT-NHNN, lenders will be permitted to provide short-term foreign currency loans to exporters who need the capital for importing input materials. Borrowers will be required to have sufficient foreign currency revenue from exports to repay the loans.
The short-term loans will be also available to those who need foreign currencies to pay for imported goods and services to serve domestic consumption, with the deadline for loans pushed back to March 31, 2019.
In addition, lenders will be allowed to consider the provision of medium and long-term foreign currency loans for the payment of imported goods and services until September 30, 2019.
According to the SBV, the extension aimed to assist local exporters and producers by reducing the borrowing costs, thereby helping them to enhance their competitiveness in international trade, especially in the context of accelerating global trade protectionism.
Exporters prefer to take out loans in dollar as interest rates for dollar loans are lower than those in dong. Currently, banks are listing interest rates at 2.8-4.7 percent per year for short-term dollar loans and 4.5-6.0 percent for medium and long-term dollar loans. Meanwhile, interest rates are 6-9 percent per year for short-term dong loans, and 9-11 peryear for medium- and long-term dong loans.
Experts have also agreed with the SBV’s plan to extend foreign currency lending, saying that it was necessary to support the country’s exports.
Financial expert Nguyen Tri Hieu said the Vietnamese economy relied heavily on exports, so exporters needed to borrow foreign currencies at low interest rates to reduce costs and increase competitiveness.
“I support the idea to continue lending in foreign currencies because it is not the right time to end this measure,” said Hieu.
Expert Can Van Luc said the SBV should consider extending foreign currency lending after December 31 this year since Vietnam was integrating more with the world and  local demand for foreign currencies was legitimate.
Luc believed that removing foreign currency credit would negatively impact the exchange rate as the proportion of foreign currency loans was relatively small.
It was estimated that outstanding foreign currency loans, mainly in US dollars, of banks, especially State-owned ones, were nearly 300 trillion VND (12.76 billion USD) by the end of June.
VietinBank topped the list with outstanding foreign currency loans of nearly 109.98 trillion VND by the end of June, followed by Vietcombank with 99.25 trillion VND and BIDV with 86.25 trillion VND.
Some private banks also reported high foreign currency loans, such as Sacombank with 12.73 trillion VND, Eximbank with 10.45 trillion VND and Techcombank with 10.1 trillion VND.-VNS/VNA
Read original article here
Newer News
11:03 Reference exchange rate continues going up
07/12 Reference exchange rate continue to rise
06/12 Reference exchange rate rises further on December 6
05/12 Reference exchange rate up 2 VND on December 5
04/12 Reference exchange rate kept stable
03/12 Reference exchange rate up 5 VND on week’s first day
30/11 Reference exchange rate up on November 30
29/11 Reference exchange rate kept stable
29/11 Over 3.6 trillion VND collected from G-bond auction this week
Older News
27/11 Reference exchange rate up 4 VND
26/11 Reference exchange rate opens week unchanged
23/11 Reference exchange rate rises further on November 23
22/11 Reference exchange rate continue to rise on November 22
21/11 Reference exchange rate up 5 more VND on November 21
20/11 Reference exchange rate ups 5 VND
19/11 Reference exchange rate stays unchanged on November 19
16/11 Reference exchange rate down further on November 16
14/11 Reference exchange rate turns around to drop on November 14
13/11 Reference exchange rate up 2 VND on November 13
Newsletter Signup
Top Stories
VN Index to rise amid volatility, weak liquidity
VN stocks continue rallying
VN manufacturing PMI hits 22-month high in March
CPI goes up 4.96 percent year-on-year in first quarter
Slight rise in February CPI
Market Update
Last updated at 11:31:55 AM
VN-INDEX 953.40 -2.49/-0.26%
Real-time chart
Top 5 Actives
Top 5 Gainers
Top 5 Losers
My Favorite Quotes
Your most recently viewed tickers will automatically show up here if you type a ticker in the Get Quotes box on the top of the page.
Company Research
Type in the symbol above for thorough background information, key statistics and financial information.
Stock Sectors
We continuously improve our services, here are the latest updates...
Allow you to monitor a customised group of securities. You can set up multiple Portfolios to help you better manage your investments.
Trigger Alerts
Get up-to-date alerts delivered directly to your email address.
Stock Screener
Allow you to filter the market and find exactly what sort of company you are looking for.
Live Terminal
Get instant access to FREE REAL-TIME streaming quotes for hundreds of stocks from HOSE, HNX and UPCOM exchanges.