In a report released last week, Viet Dragon Securities Company (VDSC) expected the SBV to adjust its credit growth target to better suit actual needs.

The SBV earlier this year set credit target for 2022 at 14 per cent against 12 per cent in 2021. However, it said the rate might be adjusted flexibly in its operational approach.

Customers at a Vietcombank office. Credit from August 15 to the end of the year will be allowed to increase by only 4.4 per cent or about VND457.45 trillion, less than half of the credit demand from the beginning of the year to August 15. - VNA/VNS Photo

According to VDSC, the SBV is under pressure to loosen credit as the SBV’s statistics showed credit growth as of August 15 this year reached more than 9.6 per cent, up some 1.5 times compared to the same period last year. It meant that credit from August 15 to the end of the year will be allowed to increase by only 4.4 per cent or about VND457.45 trillion, less than half of the credit demand from the beginning of the year to August 15.

Meanwhile, VDSC said, credit growth in the second half of a year is usually higher than in the first half of the year since 2013, except for 2019. However, 2022 has a peculiarity of being a post-pandemic recovery year. Therefore, capital demand accelerated sharply in the first half of the year. In the first seven months of 2022, the number of newly established and re-operating enterprises increased by 17.9 per cent and 49.7 per cent respectively over the same period. This implies that the capital demand for enterprises to return to operation and their capital need for new investment is still quite large.

Based on the recovery prospects of the economy, VDSC analysts forecast the credit demand in the economy will still be high in the coming months.

According to VDSC, the tightening of credit room in the third quarter of 2022 will partly affect business and expansion plans of enterprises in the rest of the year. Since early Q3 2022, banks have had to tighten their credit as their assigned credit growth quota ran out. Therefore, it has been difficult for enterprises to have access to bank loans.

Besides, the tightening will also affect the implementation of the 2 per cent interest rate support package in the Government’s economic recovery and development programme. The disbursement of the VND40 trillion support package has remained limited after nearly three months of implementation. The central bank reported commercial banks lent nearly VND4.1 trillion to nearly 550 customers under the package.