Vietnamese PM expresses concerns over growing black credit

Vietnamese Prime Minister Nguyen Xuan Phuc on Thursday expressed his concerns over the situation that black credit remains growing in Vietnam, especially in rural areas.

Phuc made the remarks at a conference held by the State Bank of Vietnam (SBV) in capital Hanoi on Thursday to review the tasks of 2016 and implement those in 2017.

Phuc urged the SBV, commercial banks and local authorities to increase informing local people of credit knowledge.

In addition, the cabinet chief pointed out shortcomings and limitations in the banking system operations including high interest rates, high bad debt rate, slow and non-substantial handling of bad debts and weak banks among others.

"Experts call these issues cancer' and key bottlenecks' of the economy. Failing to thoroughly handle them, it is unable to reduce interest rates and ensure sustained macro-economy," Vietnam's state-run news agency VNA quoted Phuc as saying.

Reports released at the conference showed that as of Dec. 29, 2016, Vietnam saw a surge of 18.38 percent in capital mobilized for the whole year.

Last year, short-term lending interest rates hovered around 6-9 percent per year while medium and long-term rates stood at 9-11 percent. Especially, some institutions reduced their deposit rates by 0.3-0.5 percentage points and cut their lending rates by 0.5-1 percentage points.

(APD)