Credit growth forecast to slow to 9-10% in 2020
Credit growth would likely reach only 9-10 per cent this year against 13 per cent last year even if the country’s infrastructure investment was good, experts forecast.
The growth rate would be lower than the central bank’s 11-14 per cent targeted for this year.
According to experts from Yuanta Securities Company, the central bank’s second interest rate cut of 0.5 percentage points recently might not really boost credit demands of firms.
The reduction has a more positive impact on the banking system and might affect the economy more strongly than the first rate cut in March. Accordingly, a series of input interest rates offered by banks, especially the short-term deposit interest rates, which are lower than in previous periods, will help banks reduce deposit costs significantly and support businesses to extend their debt and restructure loans.
However, under the current context, instead of interest rates, firms are caring more about whether the COVID-19 pandemic will be controlled, especially in countries that have significant trade balance with Việt Nam, such as the US, EU, China and Japan, according to the experts.
If consumption demands are still limited, firms will not borrow even if interest rates are low and banks must also be very cautious in disbursement because of bad debt concerns, the experts explained.
As investment in infrastructure increases, credit in industry and construction is forecast to rise higher compared with the last two years. — VNS