Vietnam's pace of loan growth is increasing, central bank says

HANOI (REUTERS) - Lending by Vietnam's banks, which contracted early this year, now is picking up pace, according to the country's central bank.

It said that through May 22, the total amount of loans was 2.29 per cent larger than at the end of 2012.

In the first two months this year, lending shrank. At the end of February, the total of bank loans was 0.3 per cent below that at end-December.

Starting in March, lending began to increase. As of April 23, loans were 1.4 per cent greater than at the end of last year.

The improved pace of lending "is an encouraging sign", the State Bank of Vietnam said in a Monday report, adding that several businesses with healthy finance have managed to take loans at rates of 7-8 per cent, compared with 11-16 per cent last month.

The expansion of loans could help increase Vietnam's economic growth rate this year. The government has projected gross domestic product will expand 5.5 per cent in 2013, compared with 5.03 per cent last year.

Bank shares, including Vietcombank and Sacombank, were among the best performers on Vietnam's stock market on Monday morning.

Join ST's Telegram channel and get the latest breaking news delivered to you.