Hanoi (VNA) - Despite expectations of stable interestrate levels this year, credit institutions have made adjustments in theirforecast for capital mobilisation and credit growth in the second quarter andthe year, according to a State Bank of Vietnam (SBV)’s latest survey.

The survey on business trends of credit institutions conductedfrom February 25 to March 9 by the SBV’s Statistics and Forecasting Departmentquestioned all credit institutions and branches of foreign banks nationwide.The rate of response was 89.5 percent.

Specifically, the capital mobilisation of the whole system wouldlikely grow at 5.58 percent in the second quarter of the year and 16.23 percentin the whole year, slightly less than the expectation of 16.76 percent made inthe December 2016 survey.

Credit growth from April to June this year is anticipated to reach5.81 percent while that for the whole year would be 17.23 percent, lower thanthe 2016 real growth rate of 18.25 percent and 2017 target of 18 percent.

Earlier, in the 2016 survey, the credit growth was expected to beeven higher, at 20.09 percent. 

According to the survey’s results, the abundance of bankingliquidity is forecast to be maintained in the second quarter and the whole yearfor both, the Vietnam dong and foreign currency, as it was inthe first three month of the year. 

Liquidity abundance of the credit institution system is afoundation for stabilising the interest rates of deposits, which helps keep theinterest expense stable and thereby maintain the net interest margin.

It is also one of the prerequisites for stabilising the lendinginterest rates to support production and business expansion of enterprises,contributing to the economic growth target of 6.7 percent this year.

Most of the credit institutions said that their bad debt tooutstanding loan ratio in the second quarter of the year would be less than orunchanged from the levels of the first three months of the year.

The survey also reveals that more than 90 percent ofcorrespondents expect they would reap higher after-tax profit in this year thanlast year.

The optimistic forecast of the institutions was based on theirconfidence in the Government’s efforts to improve business climate and theirown actions to strengthen its internal operations.

Overall, 75.2 percent of credit institutions expect a betterbusiness outlook in the second quarter and 83 percent of those surveyed believein better business results in the whole year.

With regard to average prices of financial products and services,half of the credit institutions answered that they would keep the average priceunchanged for the whole year, while 20 percent of them said that they plan aslightly decrease and 30 percent responded with a small rise.-VNA