On 30 December 2024, the State Bank of Vietnam (SBV) issued a document to all credit institutions (CIs) to publicly announce the principles for assigning the credit growth targets for 2025. Accordingly, the SBV projects that the credit growth of the entire banking system in 2025 will be 16%.
The headquarters of the SBV
Following closely the resolutions of the National Assembly and the directions of the Government and the Prime Minister, the SBV continues to implement the measures for the credit management in line with the macroeconomic developments to support the economic growth and maintain control of the inflation. To enable the credit institutions to supply credit resources to meet the demands for the economic growth, on 30 December 2024, the SBV sent a Document to the credit institutions to publicly announce the principles for assigning the credit growth targets for 2025, allowing the CIs to proactively implement the measures.
The credit growth targets for the CIs will be based on their 2023 ratings as stipulated in Circular 52/2018/TT-NHNN (as amended and supplemented), multiplied by a coefficient applied to all banks. Accordingly, the SBV projects that the credit growth for the entire system in 2025 will reach 16%. In addition, the SBV will continue to implement the roadmap to limit and eventually eliminate the practice of assigning specific credit growth targets to individual CIs as per Resolution No. 62/2022/QH15 dated 16th June 2022 of the National Assembly.
In this Document, the SBV also requested the CIs to ensure safe and effective credit growth, in full compliance with the legal regulations, and in alignment with the risk management capabilities, the liquidity conditions, and the capital mobilisation ability of each CI, ensuring the credit quality, the correct use of money, and minimising the rise and emergence of bad debts, while still ensuring their operational safety. The credit growth should be aligned with the Government's priorities, focusing on production and business sectors, the priority areas and the growth drivers as directed by the Government, while still maintaining tight control over credit in potentially risky areas; improving the capacity in assessing and appraising credit. Furthermore, any legal violations in the credit operations must be promptly detected and strictly dealt with. The SBV also encourages the CIs to continue to reduce their operational costs and enhance the application of information technology and the digital transformation to create room for further reductions of the lending interest rates.
In 2025, the SBV will closely monitor the actual developments to manage the credit growth of the banking system in a proactive, flexible, and effective manner, ensuring that the CIs can provide sufficient credit resources to support the economy, while still ensuring the safety of the system. The aim is to prioritise the economic growth, maintain the macroeconomic stability, and control the inflation. The SBV will proactively adjust the credit growth targets as needed to ensure that the CIs can supply sufficient and timely credit resources to the economy without the need for formal requests by the CIs.
HP