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Vietnam credit growth reaches 6 percent to June

Credit growth in Vietnam has hit 6 percent in the first six months of the year, according to the State Bank’s Deputy Governor Dao Minh Tu. This is a significant improvement over the same time last year when it had reached just 1.46 percent. It is, however, still a long way from the 14 percent target set at the beginning of the year.

Of note, last year, credit growth limits languished for the better part of the year. In October, however, when it became clear that the same 14 percent credit growth target would not be hit, Vietnam’s banks embarked on some very aggressive marketing campaigns. These were very successful, based on credit growth alone, with almost as much credit issued in the last two months of the year as had been issued in the rest of the year combined. These loans, however, looked to have been mostly small-scale consumer credit rather than economy building business loans. Rising bad debts in the first six months of this year might also suggest there were some quality issues with these loans.

See also: Banking in Vietnam: Industry Overview 2024

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