HANOI (Reuters) – Vietnam will preserve a versatile financial coverage aimed toward controlling inflation, whereas authorities will monitor the insurance policies of U.S. President-elect Donald Trump so as to regulate home insurance policies accordingly, its central financial institution mentioned on Tuesday.
Dangerous debt was on a rising pattern and Vietnam’s bond and inventory markets are dealing with difficulties, as is the property sector, regardless of indicators of restoration, deputy central financial institution governor Dao Minh Tu advised an everyday press briefing.
Vietnam’s manufacturing-led financial system expanded 7.09% final yr to $476.3 billion, outpacing the 5.05% progress of 2023, official knowledge confirmed on Monday. The expansion was pushed by robust exports and strong overseas funding inflows.
However regardless of the momentum, economists say weaknesses stay within the banking and actual property sectors, with credit score progress under goal.
Tu mentioned non-performing loans had been beneath management and industrial banks had been working stably. Financial institution lending had elevated 15.08% as of Dec. 31 and the central financial institution was concentrating on credit score progress of 16% this yr, he added.
The central financial institution is coping with troubled lender Saigon Joint Inventory Industrial Financial institution (HM:) (SCB), he mentioned, including the takeover of two weak banks by personal lenders can be accomplished earlier than the Lunar New 12 months. In October, the central financial institution mentioned one other two had been to be absorbed by larger banks.
The State Financial institution of Vietnam final yr mounted an unprecedented rescue of SCB after it grew to become embroiled within the nation’s largest monetary fraud. Reuters reported in April the SBV had pumped in $24 billion in “particular loans” to stop its collapse.
Pham Chi Quang, head of the central financial institution’s financial coverage division, mentioned insurance policies of the Trump administration can be monitored carefully.
America is a high vacation spot for Vietnam’s exports and Trump has pledged to impose new tariffs on imports.
Quang mentioned overseas alternate coverage “would stay versatile” in accordance with world components.
“We’ll proceed to stabilise rates of interest and the foreign exchange price amid difficulties in 2025. It is a difficult job for the SBV within the coming time however we’re assured to have the ability to management the market,” Quang mentioned.
Vietnam’s dong is presently buying and selling near its lowest ranges in opposition to the greenback.
