Trang Chủ
Due to difficulties in boosting lending for businesses amidst the unfavourable business environment and increasing bad debts, banks have to find an outlet for the credit line in personal segment, which promote real estate loans and consumer loans. To promote the growth of outstanding loans, recently, commercial banks have reduced the interest rates for individual customers.
At Tien Phong Commercial Joint Stock Bank (TienPhongBank), to use up its credit “room” as assigned by the State Bank of Vietnam (SBV) at 27 percent this year, the lender is actively launching various lending programmes for individuals and businesses with preferential interest rates. Individual loan interest rate (loans for buying, building and repairing house and loans for car purchase) is being applied at 0.82%/month (equivalent to 9.9%/year) and it will be fixed in the first three months.
Also at HDBank, since the beginning of September, the bank has applied the preferential interest rates of 8.6%/year in the first three months for individual customers who wish to borrow capital to buy a house and support the working capital. At the same time, HDBank has also cut interest rates by 4%/year for other borrowers for purposes of production, business loans, home repair, car purchase and consumer loans.
From September 11, OceanBank has made concurrently five credit products with super-speed loan approval time (within four hours) such as loans for officers, loans for car purchase, loans for students to buy motorcycle, loans for overseas studying and mortgage loans. The bank also implemented an incentive programme to reduce the interest rate to 9%/year. Vietnam Commercial Joint Stock Bank for Foreign Trade (Vietcombank-VCB) and Vietnam International Commercial Joint Stock Bank (VIB) are also applying the same interest rates.
However, the aforementioned preferential interest rate policy will be only applied in the first three months after the disbursement. The interest rates in the next periods will be adjusted periodically according to the bank’s common interest rate benchmark, even up to 18 – 20%/year for secured loans and it may be higher for unsecured loans.
In addition, lending conditions with individual customers are also very tight. At HDBank, according to Nguyen Huu Dang, the bank’s general director, the customers are granted only 40 percent of their personal income with the average salary of 15 million dong/ month being paid through the card account of HDBank or other banks.
On the other hand, the bank will also supply only 50 percent of the capital needs of the customer for consumption, purchase, repair, etc. In particular, with home and apartment loans, HDBank only provides loans in projects that have link with banks and projects under the completion stage.
With the credit growth in the entire banking sector in the first nine months of this year at only 2.3%, so banks are speeding up pouring capital for personal segment due to difficulties in the corporate credit segment. Therefore, banks have used moves of preferential interest rates at below the interest rate cap with the expectation of attracting individual borrowers.
However, according to a staff in the banking sector, the reduction of interest rates for personal loans in some banks is now only a solution measure to spur credit growth. Therefore, individuals who are in need of capital should also be cautious because if the preferential interest rates are given in the first three months, then the bank would increase the interest rate significantly.
