'Impossible' to lend dong loans with US dollar rate, says SBV governor

State Bank of Vietnam's governor Nguyen Van Giau on June 18 confirmed that it is impossible to lend dong loans with the US dollar lending rate.

To help exporters solve difficulties, the Ministry of Industry and Trade recently proposed SBV to allow exporters to borrow dong loans with US dollar lending rates. What is SBV's comment on the proposal?

SBV governor: Early June 18, I worked with minister of Industry of Trade and gave SBV's point of view clearly that lending dong with US dollar rate is impossible. May be the trade ministry only concerns three groups of enterprises licensed to borrow US dollar, including importers, matured debt payment and overseas investment. Previously, exporters also had the right to borrow US dollar and then sell back to banks to take the dong. Up to now, many enterprises including private firms proposed to be allowed to carry out the right to earn profit difference. But SBV denied the proposal for a fear of market disorder.

SBV forbid credit institutions to collect extra fees based on lending rate but the banks did not disburse all loans. How will the central bank deal with the violations?

Currently, some transaction points of few banks without SBV's permission offered disbursement plans to indirectly increase lending interest rate. I confirm SBV tackle with violations strictly right after detection. (NLD)