VNDIRECT RESEARCH
support businesses recovery. Following this, commercial banks committed to cut off over VND20.6tr from profit to lower lending rates by 0.5-2.0% for outstanding loans of pandemic-hit clients. According to SBV, the total amount of interest exempted or reduced by credit institutions for customers from 15 Jul, 2021 to 30 Sep, 2021 was about VND12,236bn, equivalent to 59.4% of commitment. Despite the rising inflationary pressure, we expect the SBV to maintain its accommodative monetary policy until at least the end-2Q22. Although we do not expect the central bank to cut its key policy rates further, we also think it would not lift them either in 1H22, in a bid to continue supporting the economy by maintaining a loose monetary policy. Nevertheless, we expect the SBV to channel its money market activities via the open market, such as buying foreign exchange or raising the credit growth ceilings. We forecast credit growth to increase by 13-14% yoy in 2022F. Figure 34: Policy rates and government bond 5Y (01/2017-10/2021)
Figure 35: Credit and deposit growth (01/2019-09/2021)
Source: BLOOMBERG, VNDIRECT RESEARCH
Source: Commercial banks, VNDIRECT RESEARCH
Implication for our 2022 forecasts The growth gather steam since 2022 Figure 36: Key macro forecasts in 2021
Source: VNDIRECT RESEARCH, GSO, SBV, MOF
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