At the workshop “Enhancing the ability to access and absorb capital of the business sector: Difficulties, challenges and determination” on the morning of August 22, Ms. Ha Thu Giang - Director of the Department of Credit for Economic Sectors updated some growth figures.
Specifically, the entire banking industry has made efforts to implement policies and strategies, many of which are implemented with the resources of credit institutions themselves. However, economic credit in the first 7 months of 2023 still increased lower than the same period in previous years, reaching about 12.47 million billion VND, up 4.56% compared to the end of 2022, reflecting the general difficulty in the economy's capital absorption capacity in an objective context with many influencing factors.
First, Ms. Giang mentioned the impact of investment and production demand. Accordingly, businesses have not yet fully recovered from the Covid-19 pandemic, combined with the negative impact of the global economic downturn, so the demand for loans and the ability to absorb capital have decreased.
Although domestic economic indicators are showing positive trends (such as: July exports increased by 2.1% compared to June, IIP industrial production index increased by 3.9%...), due to the cumulative impact from the market in the first months of the year, credit by the end of July was still lower than the same period of previous years.
Ms. Ha Thu Giang, Director of the Department of Credit for Economic Sectors, State Bank.
In addition, some customer groups have needs but do not meet the loan conditions, especially small and medium enterprises and cooperatives due to small capital scale, limited equity and financial capacity, limited management and administration, lack of feasible business plans, and lack of transparency in the financial situation of small and medium enterprises...
Regarding the impact of the credit absorption capacity of the real estate group, real estate credit accounts for about 20% of total credit, so when real estate credit increases, it will lead to an increase in credit for the entire system.
However, the Director of the Credit Department said that currently, real estate credit growth is lower than general credit growth; in which, outstanding real estate business loans in the first 6 months of 2023 increased (17.41%) exceeding the growth rate of the whole year 2022 (10.73%), but outstanding consumer loans and self-use real estate loans, which account for 65% of outstanding real estate credit, decreased by 1.12%.
This is also the first year that consumer debt and real estate self-use debt have shown a downward trend in the past 3 years. By the end of 2022, credit in this sector increased by 31.01%. This shows that credit capital is focusing on the supply side of the market, while credit demand for real estate purchases for consumption and self-use purposes in the market is decreasing.
“This shows that the recent solutions to remove difficulties for the markets have begun to take effect, the legal difficulties of real estate projects have gradually been resolved, contributing to increasing the ability of project investors to access credit,” said Ms. Giang.
Overview of the workshop.
However, in the context of general difficulties, the need to buy housing is not a priority at the present time; the product structure is unreasonable, there is an excess of products, high-end segments, lack of affordable housing, suitable for people's needs, real estate projects face legal difficulties so they cannot meet credit conditions, leading to difficulty in accessing capital.
Besides, according to the State Bank, the bad debt ratio of the real estate sector is increasing compared to the end of last year (June 2022 was 1.53%, June 2023 was 2.47%).
The final factor that prevents businesses from absorbing capital is the level of risk that is assessed higher after a period of economic difficulty. When businesses find it difficult to demonstrate their effectiveness, credit institutions find it difficult to make lending decisions because they cannot lower credit standards to ensure system safety.
In the remaining months of 2023, the State Bank hopes to continue receiving the coordination of ministries, branches, localities and the participation of Associations and enterprises in restructuring, improving operational efficiency, contributing to promoting growth associated with macroeconomic stability, and completing the economic development targets set by the National Assembly and the Government .
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