|From the beginning of the year until now, economic capital has depended mainly on bank credit. Photo: Internet
Weak enterprises due to lack of “oxygen”
Speaking at the seminar “Remove difficulties in capital for enterprises” recently held by Nguoi Lao Dong, Mr Truong Tien Dung, Standing Vice Chairman of Ho Chi Minh City Food Association, said that enterprises’ access to capital is not easy at this time. Food enterprises produced daily necessities for consumption, and they were facing many difficulties in meeting the market demand for Tet and 2023. Therefore, Mr Dung hoped the SBV and other commercial banks share faster and much more for enterprises to help them access capital better to overcome difficulties.
Meanwhile, Mr Nguyen Quoc Ky, Chairman of the Board of Directors of Vietravel Group, questioned the difference in policies for enterprises in the period before and after the pandemic. “We expect the Government to point out that difference because if it can’t, the bank won’t dare to do anything. Is the pandemic meaningless if the lending standards are the same before and after the pandemic? And is the stagnation of enterprises only temporary? I propose that the Government and the State Bank of Vietnam rearrange lending criteria and conditions to support enterprises and have a mechanism for banks to implement”, said Mr Ky.
Mr Nguyen Quoc Ky also assessed that the current policy was behind reality and “just walking and finding the way”, so it was challenging for enterprises. Accordingly, it was necessary to develop policies that could go ahead for institutions such as finance and banks to follow. “After the pandemic, the sick body needs oxygen, finance is oxygen, but if enterprises have to share it, they cannot be healthy. For example, the Government has a policy to support 2% interest rates for some enterprises, but tourism is not included in the preferential treatment. Similarly, the aviation industry is also facing a serious lack of capital, but the policies for these two industries are almost non-existent. We hope the SBV recommends the Government to design policies for these two key industries”, emphasized Mr Ky.
It is necessary to open the channel for corporate bonds soon
In fact, from the beginning of the year until now, the banking industry has been very active in implementing programs to support enterprises. Do Thanh Son, Deputy General Director of Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank), said that by the beginning of December, VietinBank had provided the economy with more than 1.2 million billion dongs, an increase of about 10.7 % compared to the beginning of the year. The lending sectors were mainly green credit and essential sectors under the direction of the Government. As for the credit room, Mr Son said after opening the room, VietinBank increased by about VND 20,000 billion, contributing to timely meeting capital for enterprises. It reviewed and designed suitable products with reasonable interest costs to meet capital in the upcoming Lunar New Year. VietinBank also focused on reviewing and minimizing costs to curb the current increase in lending interest rates.
Mr Nguyen Minh Tri, a Member of the Board of Directors of the Bank for Agriculture and Rural Development (Agribank), also said that the important principle of Agribank for lending was to win with and accompany enterprises. “When enterprises are good and operate effectively, we will be able to recover capital; If they had no revenue and no cash flow, how can banks give loans?” – Mr Tri emphasized. Therefore, in the recent interest rate race, Agribank was always cautious, listening and adjusting limitations, meeting the request to reduce interest rates. In December, the bank reduced 20% of the total interest payable to customers. Agribank was willing to use internal resources to create favourable conditions for the enterprise to reduce difficulties. Because when enterprises exist, banks only can develop.
From the perspective of the State Bank, Mr Nguyen Duc Lenh, Deputy Director of the SBV Ho Chi Minh City branch, said that in 2022, the bank-enterprise connection program had connected about VND 443,000 billion, associated with policies of the debt restructuring. interest rate reduction and exemption, debt group unchanged… About 93% of the total commitments of VND 443,000 billion had been disbursed and would continue to connect banks and enterprises in the remaining days of this year, perhaps even exceeding the registered number of VND 443,000 billion.
In 2023, this program will continue to be implemented to remove difficulties in capital, especially in association with supporting policies such as Decree 31 and Resolution 11 of the Government and Circular of the SBV on the program of 2% interest rate support.
However, according to experts, the banking industry cannot forever worry about medium and long-term capital for enterprises. Credit has grown by over 12% since the beginning of the year, equivalent to nearly VND 1.4 million billion of credit capital provided to the economy, but still not meeting the needs of enterprises. Therefore, it is necessary to open the corporate bond channel soon to meet enterprises’ medium and long-term capital needs.
Analyzing the capital supply situation of the economy, Dr Can Van Luc, a member of the National Financial-Monetary Policy Advisory Council, said that in 2021, total credit would account for about 50% of total investment capital in society as a whole. However, in the 11 months of 2022, the economy relied too much on credit capital. Nearly 70% of capital for real estate comes from credit because the bond channel was limited and congested. Other channels were limited. Therefore, it was necessary to balance more between domestic and international bond channels and bank credit capital.
However, regarding the problems of the bond market over the past time, Mr Can Van Luc said that the Government should soon solve and quickly handle the recent cases to protect the legitimate interests of investors. In particular, pay close attention to the story of bonds maturing soon, especially in the real estate sector.
Also related to this issue, Dr Vu Dinh Anh, an economist, said the key issue was declining confidence in the market. Therefore, it was necessary to properly analyze the causes of the decline and loss of confidence to find a solution to restore and strengthen confidence, thereby removing the synchronous difficulties. This removal must also be based on the market mechanism, avoiding excessive administrative measures, distorting the market, and causing unnecessary disturbances that would affect the development roadmap of enterprises and the whole economy.
Mr Can Van Luc also said that in the future, credit growth management should learn from the experience of 2022, when it grew rapidly in the first 6-7 months, so it was impossible to anticipate all the difficulties related to public investment and have to “brake”. Therefore, it was necessary to consider how to “brake” not to create surprises. Regarding real estate credit, the Ministry of Construction should group real estate enterprises into 4 segments and supervise and lend according to these 4 groups.