Vietnam’s central bank considers abolishing credit growth quota

HANOI, Oct. 24 (Xinhua) — The State Bank of Vietnam is studying a roadmap to gradually abolish the credit growth quota policy following the National Assembly and the government’s directions, Vietnam News cited the bank’s Deputy Governor Pham Quang Dung as saying on Thursday.
Credit growth quota has been allocated to commercial banks in Vietnam since early this year.
Some banks registered high credit growth rates, even doubling the growth rate of the entire system, while some saw slow credit growth, even negative growth. This unevenness is a problem of the credit growth quota policy, Vietnam News reported.
The bank said the credit growth quota could not be abolished at the moment because it might cause credit to grow too rapidly, which would affect the safety of the banking system and cause inflation risk.
In a report recently submitted to the National Assembly, the central bank’s Governor Nguyen Thi Hong said the abolishment of the credit growth quota must take cautious steps and needs an appropriate roadmap.
As of Sept. 30, Vietnam’s credit growth was recorded at 9 percent over the end of 2023.
The central bank set a target for credit growth at 15 percent this year. ■