Construction of a new residential complex in the capital city of Hanoi (Photo: VNA) The bank said lower interest rates, which have been expected to prevailthroughout this year, will likely result in a speedy recovery for the market.
In a recent report by the SBV, credit for the market accounted for about 26% ofthe total outstanding loans last year. As a result, the lending rates for themarket in commercial banks including HDBank, Techcombank, VPBank, SHB, MSB, MB,and TPBank increased compared to the end of 2022.
Techcombank had the highest proportion of lending for propertydevelopment activities, with 35.22% as of December 31, 2023, compared to 26.44%in the same period in 2022. VPBank ranks second with a proportion of propertylending at 19%, compared to 14.39% at the end of 2022.
VietBank also recorded a 19%, but this rate decreased by 1 percentage pointcompared to the end of 2022. Some other banks also saw a surge in theproportion of property lending, such as SHB increasing from 8.33% to 15.45%;and MB increasing from 4.91% to 7.49%.
MSB recorded a slight increase from 8.75% to 8.96% of total outstanding loans,TPBank rising from 6.31% to 7.12%, while this rate at Saigonbank remainedunchanged at 6%.
According to the report, credit growth in 2023 was recorded at 13.5%,reflecting the banking sector's effort to support the property market. Thecentral bank said it has set a credit growth target of 15% for the year 2024.
VNDirect Securities Company said the gradual easing of "bottlenecks"will help the market recover from the second half of 2024. The security firmsaid the reduced interest rate will give developers more room in terms ofcapital, and support housing demand. VNDirect also expects the net profitmargin of developers to recover in the coming quarters.
Consumer credit continued to decline, however, reflecting buyers'caution. The mortgage interest rate was reported at 11%, down from its peak of13-14% in recent years.
"The decrease in interest rates is expected to improve thedemand for houses, which strengthens developers' ability to maintain a healthycash flow. We believe that the residential market has passed the most difficultperiod and will show clearer signs of recovery from the second half of2024," said a VNDirect analyst.
To stimulate credit flow into the market, developers said thebanking industry should be more flexible regarding credit conditions.Specifically, it could further simplify documentation requirements, shortenapproval times, and grant credit in less than one month.
In addition, they called on the Government to extend therestructuring period for loans by allowing the use of 34% of short-term capitalfor medium- to long-term loans (instead of reducing it to 30%) and extend loanperiods for industries directly related to the market./.
VietBank also recorded a 19%, but this rate decreased by 1 percentage pointcompared to the end of 2022. Some other banks also saw a surge in theproportion of property lending, such as SHB increasing from 8.33% to 15.45%;and MB increasing from 4.91% to 7.49%.
MSB recorded a slight increase from 8.75% to 8.96% of total outstanding loans,TPBank rising from 6.31% to 7.12%, while this rate at Saigonbank remainedunchanged at 6%.
According to the report, credit growth in 2023 was recorded at 13.5%,reflecting the banking sector's effort to support the property market. Thecentral bank said it has set a credit growth target of 15% for the year 2024.
VNDirect Securities Company said the gradual easing of "bottlenecks"will help the market recover from the second half of 2024. The security firmsaid the reduced interest rate will give developers more room in terms ofcapital, and support housing demand. VNDirect also expects the net profitmargin of developers to recover in the coming quarters.
Consumer credit continued to decline, however, reflecting buyers'caution. The mortgage interest rate was reported at 11%, down from its peak of13-14% in recent years.
"The decrease in interest rates is expected to improve thedemand for houses, which strengthens developers' ability to maintain a healthycash flow. We believe that the residential market has passed the most difficultperiod and will show clearer signs of recovery from the second half of2024," said a VNDirect analyst.
To stimulate credit flow into the market, developers said thebanking industry should be more flexible regarding credit conditions.Specifically, it could further simplify documentation requirements, shortenapproval times, and grant credit in less than one month.
In addition, they called on the Government to extend therestructuring period for loans by allowing the use of 34% of short-term capitalfor medium- to long-term loans (instead of reducing it to 30%) and extend loanperiods for industries directly related to the market./.
VNA
