HANOI, Dec 28 (Reuters) – Lending rates in the Vietnamese dong rose on Monday to catch up with higher year-end demand while several banks faced shortages of funds, bankers and an industry official said.
Overnight rates on dong loans edged up to 10.29 percent on Monday from 10.25 percent last Friday and 9.93 percent a week ago, Reuters data showed.
Vietnam's cash-driven economy often faces higher funding demand in the last quarter, including for debt clearance, disbursement of funds committed for the year and corporate clearance of stockpiled goods. Increased demand has been pushing dong rates up in recent weeks.
Companies now withdrawing their own cash ahead of the end of the government's short-term interest rate subsidy scheme on Dec. 31 added to the fund shortages for banks, said Duong Thu Huong, general secretary of the Vietnam Banks Association.
"Several commercial banks face constraints in funding sources, but not at a level where they lose their liquidity," Huong told the Vietnam Economic Times daily in an interview published on Monday.
She said the central bank had provided funds to help the banks in difficulty maintain liquidity, but gave no value of the financial support.
Vietnam is aiming to limit credit growth next year to around 25 percent from 38 percent in 2009, the central bank said last Wednesday, stepping up vigilance against rising inflation pressures.
To help cool banks' soaring credit growth, the central bank said last week it will keep the base rate on dong loans unchanged at 8 percent for January.
It raised the base rate on Dec. 1 from 7 percent, where it had stood since April 10, as part of measures to prevent a return of high inflation next year.
On the dollar front, the central bank has been keeping the official exchange rate at 17,941 dong per dollar unchanged since Dec. 10.
State-run Vietnam television said on Monday that several export businesses have stopped hoarding dollars because the government has allowed them to borrow dollars from banks.
The government has ordered seven major state-run companies to sell dollars they have been keeping to help ease a dollar shortage that has been a problem for the economy almost all year.
(Reporting by Ho Binh Minh; Editing by Tomasz Janowski)