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Vietnam Stock Exchange Preview: Military Bank, Sacombank, Bac Giang

Economist and Hedge Fund Manager Shayne Heffernan of livetradingnews.com takes a look at Vietnam.

Focus this week in Vietnam will be on what the Government has planned for the spiraling bad debts that are plaguing the banking sector. Non-performing loans in Vietnam’s banking system rose to an estimated 8.8 percent of total lending by June 30 from 8.6 percent at the end of March, a state-run newspaper said.

Total loans in Vietnam’s banking system are estimated at 120 percent of gross domestic product, or between $150-$160 billion, according to government data.

Fitch Ratings has put the non-performing loan figure at 13 percent.

Vietnam recorded average credit growth of 26.56 percent a year in the 2008-11 period, while non-performing loans expanded at an average 51 percent a year, the central bank has said.

Bad debt rose swiftly in the past few years due to economic instability, high inventories, rapid credit expansion, risk management weakness and poor supervision of lenders, it said.

Exports

Between January and September 2012, total shrimp exports reached over USD 1.63 billion, falling 3.9 per cent from the same period in 2011. However, shipments to Japan – Vietnam’s main shrimp market – were valued at USD 440.6 million, having gone up 11 per cent and making up 27.11 per cent of exports, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).

The Ministry of Agriculture and Rural Development (MARD) has sent a good message: Vietnam’s rice exports have been increasing rapidly over the last few years, raising the hope that Vietnam’s rice exports may reach the record high of 7.7 million tons in 2012.

Analysts have also commented that it is now the “golden time” for Vietnam to boost exports, when the world’s demand increases rapidly. Rice export companies have geared up to boost the rice exports in the last months of the year in the context of the world’s fluctuating price market.

Source livetradingnews


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