Despite gloomy status in first half of year, credit growth at provincial credit instituions has increased well, achieving 10.38% compared to 12% of year’s target since the end of June. Credit expansion servicing economic development and secure operation are going to be performed by provincial bank sector in the coming months. To balance between enterprises’ interest and economic stability, growth, loan interest rate lowering, capital supply increasing need to be carried out carefully Credit breakthrough During the first months, national economy still faced difficulties, weak purchasing power, slow inventory consumption, high bad debt, etc. Therefore, credit institutios in Binh Duong province devised financial measures, i.e. direct contact with enterprises for investment orientation, debt restructuring, and loan interest rate lowering for some regulated preferential sectors. Thanks to comprehensive solutions of the State Bank and efforts of provincial banks, credit has increased. While falling by 2.61% in February, credit started to increase in March, April, growth rate continued to rise by 4.5% in May and by 3.47% in June. After 6 months, total outstanding credit was VND59,395 bln, increasing by 10.38% compared to year start and by 21.09% compared to previous term. Many commercial banks obtained positive credit growth within the first 6 months. Sacombank Binh Duong had VND4.,375 bln of bank deposits, VND3,542 bln outstanding loans, rising 55.99% compared to year start. Sacombank BD has cut lending interest rate and facilitated loan accessing of businesses, individuals. Thus Sacombank BD’s achievements of the first 6 months surpassed assigned targets. Vietinbank BD industrial park made breakthrough results as credit growth soared 16.32% in the first half of the year, meeting over 50% year’s target. Director Mai Xuan Long said, the bank rearranged operation and procedures, cared more about all types of clients. Besides, credit growth of Asia Commercial Bank increased 30%, BIDV rose 15.45%... Banks are proposing higher credit limit compared to year start. In other words, provincial bank sector made good breakthrough compared to 4.5% of the national rate. Being cautious about increasing of capital supply In spite of credit growth, there are still some big banks facing declining total outstanding loan like Techcombank decreased 11.44%, Vietcombank BD dropped 7.7%... State Bank’s Direction 03 asked commercial banks to have credit expansion solutions to achieve the 12% annual target credit growth, thus worrying banks. According to Director of Vietcombank BD Nguyen Dinh Phuc, the most important thing was that credit institutions have to address bad debt, prevent new ones. Therefore, process of collateral handling need to be speed up, facilitating debt recovering. Director of SHB Song Be branch worried: “The high credit growth will be a pressure while the economy still confronts difficulties. Therefore, many banks are easing lending conditions, which could lead to the old bad scenario of overdue debts”. Director of State Bank Binh Duong branch Bui Van Nu commented, if credit institutions actively engage in enhancing credit plus positive signals of economic recovering, provincial bank sector can achieve 12% or 15% as credit growth until year end. “Although there are still some banks could not meet targets within the first 6 months, we affirmed that this is a political duty, a task to the economy”, said Mr. Nu. Therefore, banks having low credit growth should also finance eligible clients. The State Bank Binh Duong branch encourages strong credit institutions to increase credit limit, credit growth target. “All banks contribute to right credit investment in last months in order to solve enterprises’ problems, support the market, provincial economic development; targets of the State Bank can be satisfy”, said Mr. Nu optimistically. Reported by Thanh Hong – Translated by Ngoc Huynh