Good business, bank will not regret
Hoang Minh Nhat Joint Stock Company is headquartered in Thoi Lai District, Can Tho City, specializing in rice export with annual revenue of thousands of billions of VND. The company's General Director, Mr. Nguyen Van Nhut, said that Hoang Minh Nhat is borrowing capital from Vietcombank Can Tho Branch with an interest rate of 5%/year, and the company has just established a credit relationship with VietinBank Can Tho Branch with an interest rate of only 4.8%/year.
Previously, this rice exporting company had borrowed capital through Vietcombank Can Tho for 18 consecutive years. Mr. Nhut shared that in mid-2023, his company borrowed capital from Vietcombank with an interest rate of 6.5%/year. By the end of that year, the interest rate dropped to 5.5%/year, and now it is 5%/year.
“Businesses always expect interest rates to decrease, the further the better; otherwise, they should remain stable,” said Mr. Nguyen Van Nhut.
Sharing the “secret” of borrowing cheap capital, the Western rice tycoon said: “For good businesses, accessing bank loans is very easy. They are companies that have proven that cash flow is always moving in the right direction, operating effectively, or at least maintaining stability in difficult circumstances.”
Also at 5%/year, this lending interest rate is being applied by VietinBank Hau Giang Branch for the loan of Mr. Nguyen Van Hieu's household, a catfish farmer in Kinh Cung town, Phung Hiep district, Hau Giang province. Mr. Hieu commented that the bank interest rate has decreased significantly compared to the already low figure of 5.5%/year in the same period last year.
“Last year, I had a debt of 15 billion VND with an interest rate of 5.5%/year at VietinBank Hau Giang, which I thought was very cheap, but this year the bank has reduced it even more. Thanks to that, from an initial pond of 4,000m2, I have developed it into 8 ponds with a total area of over 40,000m2, with an output of about 500 tons of fish/year,” said Mr. Hieu.
However, the problem for many businesses today is orders, not just interest rates.
Mr. Phan Huu Luc, owner of an aquaculture feed production facility in Dong Nai, said: “Bank interest rates have decreased significantly over the past year, but businesses still do not dare to borrow because there are no orders. Once there are orders, even if the interest rate is 10-12%, we are willing to borrow.”
According to VPBank, the current normal lending interest rate ranges from 7-9%/year depending on the business ranking, down from 0.3-1%/year compared to the end of last year. However, for businesses in priority sectors and businesses with good debt repayment history, the bank applies a lending interest rate of 6%-6.5%/year.
This interest rate is also applied by LPBank to businesses with import-export factors.
In order to support businesses and people to develop production and business, increase access to bank credit capital according to the direction of the Government and the Prime Minister, at the end of May, the State Bank of Vietnam (SBV) requested credit institutions to continue to drastically implement solutions to reduce costs, simplify procedures, ... strive to reduce lending interest rates by 1-2%/year.
Many banks have really stepped in. In fact, lending rates, especially in priority areas, have dropped to around 5%/year.
The general director of a top commercial bank said that banks are making efforts to create maximum conditions for businesses to access capital, first of all by reducing lending interest rates.
“It has been a long time since interest rates have been as low as they are now, with a series of loan interest rate reduction programs from banks. All fees for retail customers as well as fees for international payment and trade finance customers are waived with the desire to support customers, hoping that customers will overcome this difficult period to develop together,” the general director shared.
The bank CEO assessed that credit growth has picked up since April 2024 when the real estate market warmed up. In addition, in the past two months, many businesses in the manufacturing sector have also sought out banks to borrow capital for reinvestment.
Average lending interest rate in May: Some banks reduced by more than 1%/year
According to a survey, the average lending interest rate in May (announced by banks in June) was cheaper than at the beginning of the year.
At state-owned commercial banks , Vietcombank and BIDV announced average lending interest rates in May of 5.9% and 5.82%/year, respectively. The difference between deposit and lending interest rates is 3.2% and 3.13%/year, respectively. The difference in interest rates after deducting costs related to capital mobilization and capital use is 1.5% and 1.84%/year, respectively.
At VietinBank, from May 9 to July 15, priority customers will receive a 0.2% interest rate reduction per year. Accordingly, short-term loans have an interest rate of 5% per year, and medium and long-term loans have an interest rate of 5.6% per year.
At Agribank, this bank announced that since the beginning of 2024, it has adjusted the lending interest rate floor three times, in which short-term lending interest rates decreased by 0.5-1%/year, medium and long-term lending interest rates decreased by 1-1.5%/year compared to the beginning of the year.
Accordingly, Agribank's normal short-term lending interest rate floor is only from 5%/year, medium and long-term lending from 7.5%/year.
At joint stock commercial banks , the normal lending interest rate at VPBank currently ranges from 7-9%/year depending on the enterprise's ranking, down from 0.3-1%/year compared to the end of last year. However, for enterprises in priority sectors, enterprises with good debt repayment history, good risk level, the lending interest rate applied by the bank is from 6-6.5%/year.
6.5%/year is also the interest rate that LPBank is applying to businesses with import-export factors. BaoViet Bank is applying this interest rate to customers who are small and micro enterprises borrowing capital for the purpose of supplementing working capital for business activities.
Notably, the average lending interest rate for individual customers at ABBank from May 2024 will be only 4.74%/year, while the average lending interest rate for corporate customers will be 6.8%/year.
At VIB, the average lending interest rate in May was 6.81%/year (individual) and 5.8%/year (corporate), down sharply by 0.66% and 1.18%/year respectively compared to the previous month.
The average lending interest rate at ACB in May 2024 was 6.7%/year, down 0.08%/year compared to the previous month. The gap between lending and mobilization has also narrowed by 0.24%/year to 3.44%/year.
Eximbank reduced its average interest rate by 0.53%/year in May when it had just announced 7.23%/year.
The average lending interest rate in May at Sacombank was 7.53%/year, down 0.1%/year compared to the previous month. The interest rate difference between mobilization and lending was 3.43%/year, down 0.07%/year compared to the previous month.
However, some banks kept their lending interest rates the same as last month, such as TPBank, Nam A Bank, SHB, OCB,...
Accordingly, the average lending interest rate for individual customers at OCB is 7.76%/year, while for corporate customers it is 8.02%/year, the interest rate difference between mobilization and lending is 3.64%/year.
The base lending interest rates for individual customers with terms of 6 months and 12 months at TPBank are 8.05% and 8.25%/year, respectively. Notably, the lending interest rate for a 3-month term applied to car loans is 8.95%/year.
SHB still applies the average lending interest rate as in April, which is 7.9%/year. The difference between lending and deposit interest rates is 3.7%/year.
Source: https://vietnamnet.vn/doanh-nghiep-bat-ngo-vi-lai-vay-rat-thap-2292169.html
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