As of the end of July 2024, total outstanding loans in Hanoi reached VND 3,937 trillion, increased by 1.12% over the previous month and increased by 8.84% over the end of 2023. Of which, short-term outstanding loans reached 1,682 trillion VND, an increase of 1.38% and 11.76%; medium- and long-term outstanding loans reached 2,255 trillion VND, an increase of 0.93% and 6.77%.

Outstanding loans under credit programs in the city: loans under the bank-enterprise connection program account for 14.5% of total outstanding loans to the economy; loans to small and medium enterprises account for 18.9%; to agricultural and rural programs account for 8.93%; export loans account for 5.14%; loans for supporting industries account for 2.32%; loans to high-tech enterprises account for 0.36%; social policy loans account for 0.43%.

Regarding capital mobilization, as of the end of July 2024, the total mobilized capital of credit institutions (CIs) in the city is estimated to reach VND 5,436 trillion, an increase of 1.45% compared to the previous month, and an increase of 1.87% compared to the end of 2023. Of which, deposits reached VND 4,821 trillion, an increase of 1.61% and 3.22%; issuance of valuable papers reached VND 615 trillion, an increase of 0.18% and a decrease of 7.6% respectively.

In July, the State Bank of Vietnam (SBV) continued to encourage credit institutions to reduce costs and implement the policy of reducing lending interest rates to support people and businesses in accessing bank credit capital. The average lending interest rate of domestic commercial banks for existing and new loans ranges from 7.3-9.5% p.a.

The maximum short-term lending interest rate in VND for a number of priority sectors (agriculture, rural areas, exports, small and medium enterprises, supporting industries, high-tech enterprises) is at an average of about 3.6% p.a. in accordance with regulations of the State Bank of Vietnam.

Accordingly, the deposit interest rate is commonly at 0.1 - 0.5% p.a. for non-term deposits and deposits with terms of less than 1 month; 2.6 - 4.5%/year for deposits with terms from 1 month to less than 6 months; 3.9 - 6%/year for deposits with terms from 6 months to less than 12 months; and for terms of 12 months or more, it is at 5.1 - 6.5%/year.

As of the end of July 2024, the bad debt ratio of credit institutions accounted for 2.1% of total outstanding loans. According to the State Bank of Vietnam, Hanoi Branch, credit institutions in the area have focused on credit growth, offering many preferential credit programs and packages, and applying flexible interest rate policies. Financial institutions have maintained sufficient liquidity.

Kylie Nguyen