Vietnam aims to cut bank lending rates to between 17 pct and 19 pct

HANOI, Aug 4. Vietnam’s central bank aims to get commercial bank lending rates down to between 17 percent and 19 percent, perhaps from next month, its new governor was quoted as saying in an online report, which helped lift stock prices.

Dong rates averaged 18.64 percent in July, with loans for the agricultural and export sectors at 16-21 percent, other production and business activities at 18-22 percent and non-manufacturing sectors at 20-25 percent, the central bank said in a monthly report on Wednesday.

The State Bank of Vietnam will work with banks to try to get rates down from mid-September, Governor Nguyen Van Binh was quoted as saying.

High lending rates have been a major problem for businesses, but the authorities have had to tighten monetary policy significantly this year in the face of soaring inflation, which exceeded 22 percent in July.

Binh, who was confirmed in his post by parliament on Wednesday, said the central bank would “minimise the use of administrative intervention measures” and would maintain a tight monetary policy. He did not give further details.

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