Vietnam’s banks receive cash injection
(Vietnam) - The Vietnamese Government has continued its recapitalisation of the country’s banks by injecting 1.9 trillion dong (US$123 million) into four state-run banks’ coffers.
This latest round of government funding, the second since 2002, brings the amount to 6.8 trillion dong (US$440.27 million) and forms part of an overall total of US$514 million that Hanoi plans to use to assist banks.
The four banks, the Bank for Foreign Trade, the Industrial and Commercial Bank, the Bank for Agricultural and Rural Development and the Bank for Investment and Development, account for 80 percent of the market and are Vietnam’s chief lenders.
Last week, Vietnam’s central bank cut the re-discount rate on its loans to banks by half a percentage point to 6.0 percent per annum to encourage liquidity of the dong in the market.
The news of the funding led to a dip in demand for the dong. However, demand is expected to improve from the third quarter with several major energy and transport projects requiring funding.
In other Vietnamese news, the World Bank has loaned US$54 million to the country’s State Bank to help reform the country’s public financial management system.
The four banks, the Bank for Foreign Trade, the Industrial and Commercial Bank, the Bank for Agricultural and Rural Development and the Bank for Investment and Development, account for 80 percent of the market and are Vietnam’s chief lenders.
Last week, Vietnam’s central bank cut the re-discount rate on its loans to banks by half a percentage point to 6.0 percent per annum to encourage liquidity of the dong in the market.
The news of the funding led to a dip in demand for the dong. However, demand is expected to improve from the third quarter with several major energy and transport projects requiring funding.
In other Vietnamese news, the World Bank has loaned US$54 million to the country’s State Bank to help reform the country’s public financial management system.
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