SBV discloses credit data for first time
Early withdrawals of long-term deposits restricted
By Thanh Thuong - The Saigon Times Daily
HCMC – For the first time in history, the State Bank of Vietnam (SBV) has publicized figures regarding credit operations in the banking system.
Central bank statistics show total credits as of end-April 2012 had amounted over VND2,617.3 trillion, or around US$124 billion, down 0.59% against end-2011. Loans for manufacturing and processing industries grew 5.19% to VND607.8 trillion, making up the biggest proportion in the total of the system.
Total deposits placed by individuals recorded a strong rise of 11.78% in the first four months of the year, totaling more than VND1,449.4 trillion, while corporate deposits dipped by 5.6% to some VND1,084.4 trillion.
Overall, the total deposits from individuals and organizations picked up VND88 trillion, or 3.6%, to more than VND2,533.8 trillion, or some US$120 billion.
Meanwhile, as of the end of April, the total money supply had reached VND3,035.7 trillion, some US$144 billion, up by 3.14% (VND92 trillion) and lower than the increase of the total deposits, said SBV.
The credit-to-deposit ratio in the system as of end-April was 86%, compared the permitted 80%. Notably, the ratio at State-owned banks was 107.8% while that at joint stock banks was only 77.6%.
Total assets in the banking system by end-April had plunged 1.83% to some VND4,868.6 trillion, or US$231 billion, according to SBV figures.
* The central bank has ordered credit institutions and foreign bank branches not to pay interest to customers who want to withdraw their savings more than 12 months before maturity.
From June 8, SBV allowed banks to set out their interest rates of tenors of 12 months or more, paving the way for eradicating the rate cap.
However, several banks have launched combined savings, which allows customers to be able to deposit or withdraw cash at any time and offers tied interest rates for fixed-term savings.
For instance, some banks still pay full interest to customers when they withdraw their long-term savings from one to three months ahead of the maturity day.
SBV stated these actions were going against regulations stipulated by the central bank governor and it ordered banks to stick to the regulations of Vietnam dong deposits and deposit withdrawals ahead of maturity.
Banks are not allowed to launch savings programs which are not compliant to regulations of interest and they must publicize withdrawal regulations.
Banks must announce that customers will be entitled to the rate applied to early withdrawals and bear penalty fees or fees charged on deposits, if banks set any.
The central bank has also urged state inspectors to monitor banks’ deposit programs. If necessary, state inspectors can look into violating banks and report to the central bank on any wrongdoings.