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Many mid-range banks have credit room increased to 19-23%. Photo: Internet

As of July 28, the banking sector’scredit growth was only 3.45% compared to the end of 2019, 0.2% higher than the end of June 2020, and much lower than the same period last year (7.13%), reaching the bottom in recent years.

According to arecent report from the BIDV Securities Company (BSC), the current credit demand to extend business and production is at a low level despite credit packages with preferential interest rates.Banks have also not lowered their credit standards due tofears of risks and are more conservative in providing credit to the market to maintain asset quality to withstand the difficult period.

With such low growth, at the beginning of July, SBV Governor Le Minh Hung said that this year the SBV is determined to be proactive to adjust credit to support credit growth, so the SBV has adjusted a series of growth for commercial banks. Those that are operated fairly and provide credit to fields for economic growth will be adjusted to a higher level than the demand.

Therefore, the report of BSC stated that many banks have extended their credit standards to tens of percentage points.

The most prominent was VIB increased by 8.5-12.5 percentage points compared to the original limit, while TPBank 7.5-11.5 percentage points, HDBank 7-12.2 percentage points; VPBank and Techcombank 6-10 percentage points and MB 8.25 percentage points.

Accordingly, the credit rooms of bankshave been raised to 19-23%. Previously, the credit standards of banks approved by the SBV were as follows: VIB 10.5%; HDBank 11%; TPBank 11.5%; Techcombank and VPBank13%.

However, some banks did not raise their “rooms”, including three state-owned banks (Vietcombank 10%, BIDV 9%, VietinBank 8.5%) and ACB (11.75%), Eximbank (9%). In addition, Agribank did not apply for raising credit standard.

According to the performance results of these banks in the first six months of the year, the common feature is that the banks have a healthy financial situation and good credit growth, which has reached the target of the SBV at the beginning of the year. For example, Techcombank's credit growth has reached 13%, HDBank 11%, VIB 10.5% andTPBank 11%.

According to financial experts, from now to the end of the year, when production and business activities recover and consumption are stimulated, capital demand will increase. Therefore, a larger credit "room" will create more space for banks to finance businesses, thereby reviving the economy. Moreover, the SBV also introduced many supporting policies to the banking sector and the economy, such as reducing the operating interest rates, creating positive effects for the economy.

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However, BSC said that although banks extended their credit "room” at a relatively high rate, in absolute value, it does not have a big impact on the whole system's targets, as credit is still mainly concentrated on the group of four state-owned banks.

BSC's experts forecast that credit growth of the whole system will be 9% in 2020.