Bank capital mobilization accelerated to exceed credit growth from the end of June to August 22

Capital mobilization at the end of June still grew slower than credit, but by August 22 it accelerated, reaching 8.77%, higher than credit growth.

The data was shared by Deputy Minister of Finance Tran Quoc Phuong at the regular Government meeting in August, on the afternoon of September 3.

According to leaders of the Ministry of Finance, the short-term liquidity of the banking system has improved. By August 22, capital mobilization in VND increased by 8.77% compared to the beginning of the year, higher than the increase in outstanding credit balance of 8.38%.

This trend reversed compared to near the end of June. Near the end of the second quarter, according to data from the State Bank, capital mobilization by new credit institutions increased by more than 5% compared to the beginning of the year, lower than the credit growth rate of 7.4%.

Thus, in nearly two months, capital mobilization of the banking system has accelerated and exceeded credit growth.

This development occurred in the context of banks stepping up capital attraction and increasing interest rates on many channels such as traditional deposits, certificates of deposit and bonds.

Savings interest rates at many banks have exceeded 9% per year with deposits of only a few hundred million dong. Mobilization competition becomes fierce when the system's capital needs remain high. As of the end of June, deposit mobilization among banks was highly differentiated, some increased while others had negative growth.

At a recent conference, Mr. Pham Nhu Anh, CEO of Military Bank (MB), commented that whether liquidity will improve at the end of the year depends on the speed of public investment disbursement.

Cash flow returning to the economy will support system liquidity if public investment disbursement is accelerated in the last months of the year. If progress continues to be slow, the pressure on banks' monetary policy and capital mobilization will remain great.

Mr. Anh forecasts that interest rates from now until the end of the year are likely to move sideways. This stability mainly comes from the operating direction of the State Bank, instead of the already abundant system liquidity.