Governor: Real estate lending increased higher than economic credit growth

The above data was stated by State Bank Governor Nguyen Thi Hong when explaining to the National Assembly about the real estate market monitoring report, on the afternoon of October 28.

Ms. Hong cited data from the State Bank stating that real estate credit by the end of September was 3.15 million billion VND, accounting for 20% of the total outstanding debt of the economy. This level increased by about 9.15% compared to the end of last year, 0.15% higher than the overall credit growth rate of the economy (9%).

However, many National Assembly delegates believe that businesses still have difficulty accessing capital and real estate loan interest rates are high. Ms. Huynh Thi Phuc, Deputy Head of the Delegation of Ba Ria – Vung Tau province, stated that most small and medium-sized real estate businesses have difficulty accessing credit capital due to lack of collateral and control by banks. lending risk. She said there was a time when loan interest rates skyrocketed, to 12-14% a year.

The consequence pointed out by Mr. Pham Van Hoa (Dong Thap) is that it is difficult for real estate businesses to reduce house prices, because “they have had to borrow high amounts to implement the project”.

Explaining, Governor Nguyen Thi Hong said that loan capital for real estate projects is often long-term, while mobilization from credit institutions is short-term. As for banks, they must ensure capital adequacy ratio and recover capital to pay depositors. Therefore, even if the project is feasible and has the ability to repay debt, the bank has to refuse because “the loan term is long or needs to prioritize more urgent payments,” she said.

In fact, lending interest rates have decreased by about 3% compared to the beginning of 2022. Ms. Hong said this is an effort on the part of credit institutions. “The State Bank always directs banks to simplify procedures and save money to have resources to lower interest rates,” she shared, adding that when businesses and people face difficulties, credit institutions have dedicated resources to lower interest rates. force to reduce interest and taxes by up to 60,000 billion VND.

The Governor also said that bank credit is only one channel mobilized for this market (besides there are other channels such as the stock market, bond market…).

In this aspect, Mr. Trinh Xuan An, Standing Member of the National Defense and Security Committee, said it is time for banks to focus on supporting borrowers, instead of businesses. Because according to him, for a long time everything was entrusted to banks, but they had to perform the functions of credit institutions. That is, banks must ensure capital adequacy ratio and system.

“It is impossible to force banks to mobilize normal capital for preferential loans or take short-term capital for long-term loans,” he said.

Also according to the monitoring team’s report, the package is 120,000 billion VND Disbursement of loans to support buying and renting social housing is very low, about 1,700 billion VND by the end of September. Of this, 90% is disbursed to investors, the rest is to home buyers.

Many localities and businesses reflect that the loan conditions from the credit package are similar to other commercial business projects. The need for the Provincial People’s Committee to announce the list of projects eligible for loans adds unnecessary procedures.

Governor Nguyen Thi Hong explained that recently, the budget was limited so banks mobilized resources from the people to form a credit loan package to support social housing development. Currently, the scale of this package has increased to 145,000 billion VND, with lending interest rates reduced by 1.5-2% per year for investors for 3 years and borrowers for 5 years.

“After the Covid-19 epidemic, low-income workers are facing many difficulties and the demand for loans is not high. When the difficulties ease, the demand for loans will increase,” she said.

State Bank leaders proposed that additional budget resources be needed to participate in this credit package, in addition to the resources of credit institutions. Along with that, management agencies need to survey more people’s needs to own or rent houses, to have fundamental solutions suitable for the social housing segment.

At this point, the National Assembly’s supervision team also proposed that the Government research an appropriate credit program, in which the State supports interest rate compensation for commercial banks so that investors and home buyers can borrow in the future. certain time.