How will rising inflation and financial market correction affect the outlook for the banking sector?
According to Mr. Hoang Cong Tuan, chief economist of MB Securities (MBS), Vietnam’s inflation tends to increase according to the general context of the world.
Experts believe that besides the cost-push factor that causes the prices of basic goods to increase in the global market, the increased demand after the economy fully reopens is also a factor causing inflation. increase.
How will inflation affect banks?
For the banking industry, rising inflation may put pressure on deposit interest rates. According to the survey, currently, deposit interest rates have also increased slightly. This may put banks with lower deposit capacity than the average in the system. As for large banks, the impact is not much.
Besides, some banks are having very high CASA ratio. This will also help neutralize the impact of the increase in deposit rates, helping banks maintain good profit margins.
In general, inflationary pressure has been increasing, which can be said to be a challenge for the economic management of executive and management agencies. The representative of the General Statistics Office also mentioned that inflation pressure is increasing in 2022 and keeping the inflation target below 4% is a relatively difficult and challenging task.
However, the State Bank has had a lot of experience in price regulation over the years. Therefore, there is still room to keep inflation under control and ensure macroeconomic balance.
Impact of real estate credit slowdown and corporate bond squeeze
Regarding credit activities, Mr. Hoang Cong Tuan said that real estate loans are accounting for a relatively large proportion of the entire system’s outstanding loans. Therefore, when real estate credit growth slows down, the banking industry will also suffer certain impacts.
In the coming time, banks that still have room to lend real estate can continue to lend. But banks that have stepped up this activity right from the first quarter will take measures to cool down
However, the expert noted, credit growth depends not only on outstanding loan growth for each real estate sector but also from other industries. When the economy recovers, credit demand for manufacturing, tourism, service sectors… will also recover and capital demand for these sectors will increase accordingly.
As for corporate bonds, according to experts, the recent moves of regulators are not tightening, but reviewing and re-checking to ensure system safety.
The government’s recent market correction directives are actually aimed at redirecting capital flows. These moves are right and timely, when the economy recovers from the pandemic, the demand for capital from production and service activities increases. In the coming time, banks will also have to adjust their credit structure to make the best use of these policy directions.
Conclude
Mr. Hoang Cong Tuan said that, in general, this year banks will still record profit growth and there are still banks with quite positive prospects. However, the degree of selectivity is also much higher and the high growth is only attributable to a few banks with good deposit capacity and high credit growth.
at Blogtuan.info – Source: cafebiz.vn – Read the original article here
