Official Telegram 18/CD-TTg 2024 on managing credit growth in 2024

OFFICIAL TELEGRAM

On managing credit growth in 2024

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THE PRIME MINISTER notifies:

- The Governor of the State Bank of Vietnam.

2024 is a year of acceleration, of significant importance in the successful implementation of the 5-year socio-economic development plan for the 2021 - 2025 period. The world and regional situation is forecast to continue to have complicated and unpredictable developments; consequences of the Covid-19 pandemic still have a lasting impact. In the domestic economy, there are opportunities, advantages, difficulties, and challenges mixed together, but the difficulties and challenges are more numerous; inflationary pressure is still powerful; production and business activities in some industries and fields are still difficult; lending interest rates are decreased but not commensurate with the decrease in deposit interest rates; credit growth in the first 2 months of 2024 is decreased compared to the end of 2023.

In order to continue to improve the efficiency of managing monetary policy tools and drastically implement solutions on managing interest rates and credit to support production and business activities of people and enterprises, and promote economic growth, stabilize the macro economy, control inflation, ensure major balances of the economy. Therefore, the Prime Minister requests:

1. The State Bank of Vietnam to assume the prime responsibility for, and coordinate with relevant agencies in:

a) Urgently and comprehensively reviewing results of granting credit of the system of credit institutions for the economy, each industry and each field; results of granting credit of each credit institution and commercial bank up to the present time to have solutions to manage credit growth and interest rates in 2024 (within the ambit of competence and law provisions) more effectively, feasibly and promptly, ensuring adequate supply of credit capital to serve the economy and the safety of credit institution system, absolutely avoiding congestion, delays, or untimely events; taking responsibilities for managing monetary policies and credit growth to the Government and the Prime Minister. Any matters beyond the competence should be promptly reported and proposed to competent authorities according to regulations.

b) Monitoring closely international and domestic economic developments and situations to manage monetary policies in a proactive, flexible, prompt and effective manner; flexibly, harmoniously and reasonably managing between interest rates and exchange rates in accordance with the market situation, macroeconomic developments and goals of monetary policies as directed by the main tasks and solutions in the Government’s Resolution No. 01/NQ-CP dated January 5, 2024, to prioritize promoting economic growth and removing difficulties for production and business; effectively implementing credit growth, providing foreign currency for production and business associated with macroeconomic stability, inflation control, ensuring major balances of the economy, the safety of banking operations and the system of credit institutions, ensure the implementation of credit growth targets set for 2024.

c) Immediately implementing executive solutions to continue to reduce lending interest rates associated with increasing the access of credit capital to support people and enterprises in developing production and business, ensuring to supply sufficiently credit capital, healthy foreign currency in a focused manner, serving and meeting the capital needs of the economy and the safety of the credit institution system.

d) Promoting and strengthening inspection, examination, control and strict supervision of granting credit by credit institutions, ensuring credit capital flows, including foreign currency credit capital focusing on prioritized and important areas, economic growth drivers (consumption, export, investment), serving the development needs of production and business of enterprises and people with conditions to expand production and business safely, healthily, sustainably but lack of capital. Strictly prohibiting the grant of credit in contravention of law, to the wrong subjects or the grant of credit to leadership boards, executive boards and related people of credit institutions, enterprises in the ecosystem, backyard enterprises, etc. with preferential interest rates while people and enterprises with justifiable and legal needs have difficulty in accessing credit capital and foreign currency. At the same time, implementing tools to control inflation and reduce, limit the increase in bad debt for credit institutions.

2. The State Bank of Vietnam to direct and request credit institutions in:

a) Monitoring closely directions of the Government and the State Bank of Vietnam to continue to reduce lending interest rates (cost reduction; simplifying administrative procedures, strengthening the application of information technology, digital transformation, etc.); publicly announcing the average lending interest rate for people and enterprises to conveniently access credit and choose banks to borrow capital. Promoting the effective implementation of preferential credit packages suitable to the characteristics of each credit institution for important areas and growth drivers of the economy according to Government's policies; promoting the pioneering and exemplary role of credit institutions having effective business and state credit institutions; enhancing social responsibility and business ethics of credit institutions in sharing and supporting people and enterprises.

b) Continuing to direct credit capital to production and business areas, prioritized areas and traditional economic growth drivers such as consumption, investment, export, digital transformation, response to climate change, green transformation, circular economy, science, technology and innovation, etc. of the economy according to Government's policies; continuing to strictly control credit for potentially risky areas; ensuring safe and effective credit operations.

c) Strengthening information and communication, guidance for customers and beneficiaries in accessing policies. Focusing on clear, complete, transparent and accurate communication of policies, products, credit services and foreign exchange of credit institutions to the public.

4. The Deputy Prime Minister Le Minh Khai shall be assigned to monitor, direct, inspect, and urge handling according to his competence.

5. The Government Office shall carry out the monitoring and urging according to the assigned functions, tasks and competence; report to the Prime Minister on any matters beyond the competence./.