Among them, capital focused on the production and business sectors, accounted for a large proportion.

The business community indicated that accessing capital flows from the banks would have been implemented easily with preferential interest rates bringing a vibrant business atmosphere.

According to the State Bank of Vietnam (SBV), as of October 31, credit had increased by 16.65 percent compared to the same period in 2023. Many commercial banks achieved credit growth rates from ten percent to 17 percent in the first nine months of the year, higher than the overall industry credit growth. In particular, the production and consumption sectors have significantly recovered along with preferential credit packages also contributing to boosting loan demand.

At a transaction office of a bank in Ho Chi Minh City (Photo: SGGP/ Hoang Hung)

Apart from the top three commercial banks in credit growth in the first nine months of 2024 comprising Bank for Investment and Development of Vietnam (BIDV) with an increase of ten percent, Vietnam Joint Stock Commercial Bank for Industry and Trade Bank (Vietinbank) with 9.4 percent and Joint Stock Bank for Foreign Trade of Vietnam (Vietcombank) with a 10.23 percent increase, credit growth at other private commercial banks also grew strongly.

Deputy Director of the State Bank of Vietnam, Ho Chi Minh City branch Nguyen Duc Lenh said that by the end of October 2024, the total outstanding credit in Ho Chi Minh City reached VND3,785 trillion (US$149 billion), up 6.87 percent compared to the end of 2023. In recent months, credit activities in the area have continued to maintain growth thanks to low lending interest rates, along with supported policies and disbursement of preferential credit packages and so on.

Deputy Director of the State Bank of Vietnam, Ho Chi Minh City branch Nguyen Duc Lenh also added that credit in the area in the last two months of the year and the Lunar New Year period is forecasted to grow higher than previous months due to the usual increase in demand for production, consumption of goods, and services.

"Pumping" strong capital, yielding high profits

Although credit growth figures are not even among commercial banks, financial reports in the third quarter released by commercial banks show that vibrant credit also contributed to helping them achieve high profits. Statistics from 28 commercial banks listed on the stock exchange recorded more than VND218 trillion (US$8.6 billion) in pre-tax profits in nine months, up 16 percent compared to the same period in 2023.

At a transaction office of the Commercial Bank for Investment and Development of Vietnam (BIDV)- Ho Chi Minh City branch (Photo: SGGP/Hoang Hung)

Accordingly, in the first nine months of 2024, Techcombank's profit reached VND22,842 billion (US$899 million), up 33.5 percent compared to the same period in 2023. By the end of the third quarter of 2024, BVBank's pre-tax profit reached VND182 billion (US$7.2 million), completing 90 percent of the annual plan thanks to credit growth.

According to SSI Securities Corporation, although the economy is gradually recovering, credit is growing strongly, but credit demand is not adequate, especially in the retail sector.

In the last months of the year, the driving force for credit growth still comes from the industrial and import-export sectors as domestic purchasing power and consumption are still increasing but at a low level. It is likely that the State Bank of Vietnam will continue to maintain a loose monetary policy to support growth.