The Vietnamese central bank injected a total of VND10.7 trillion (US$560.6 million) into the banking system on April 1 and 2 to increase liquidity and encourage commercial banks to lower lending rates.
Commercial banks in the Southeast Asian nation are now lending at rates as high as 20 percent for medium- and long-term loans, according to a statement from the Ministry of Planning and Investment. These rates are "relatively high" and the central bank plans to lower them, Nguyen Dong Tien, deputy governor of the State Bank of Vietnam, said April 1, without elaborating.
"Many enterprises found it hard to access capital because of high lending rates," according to a statement on the government's website Tuesday.
In order to boost lending, the State Bank of Vietnam may also allow banks to set their own interest rates on short-term loans, Tien said on April 1. The easing of restrictions will help banks meet lending demand, bolstering economic growth. Lenders can be "more proactive and more competitive," Pham Trung Cang, head of the credit committee at Asia Commercial Bank, said on Feb. 26.
The Southeast Asian nation aims for economic growth of 6.5 percent this year, up from 5.32 percent in 2009. The economy expanded 5.83 percent in the first quarter.