Banks “open wallets” to buy real estate?

Mobilization interest rates have dropped sharply to the bottom, and companies expect that capital flows to the real estate industry will be cleared. In the last few days of 2023, deposit interest rates will continue to fall or even “hit bottom.” According to statistics, since the beginning of December, 22 banks have lowered their deposit interest rates. Among them, some banks have lowered the minimum interest rate for one month to only 1.9%.

Mr. Tran Duc Anh, director of macro and market strategy at KB Securities Co., Ltd. (KBSV), said that for real estate companies, lowering interest rates is currently one of the three most practical solutions to help companies tide over the difficulties. Since real estate companies are capital-intensive and highly leveraged enterprise groups, cash flow factors are very important.

>> Savings interest rates continue to fall to record lows

In terms of interest rates, the State Bank of Vietnam also adjusted operating interest rates four consecutive times in the first half of the year, with a reduction range of 0.5-2.0% per year. This is also in the context of difficulties in supporting the real estate market with government policies. Corporate funds are “trapped” and can only rely on bank credit funds. It can be seen that there are currently preferential access to bank funds, but not all enterprises can satisfy it.

Through discussions with enterprises, the most basic conditions to convince banks include: collateral, business plan or loan purpose, debt service cash flow or debt solvency, creditworthiness, creditworthiness of loan activities and no bad debts…

“It can be seen that the policies of the government and relevant agencies are indeed enabling the real estate market to develop healthily, with a focus on promoting enterprises in this field to continue to operate effectively and efficiently. Specific strategies” – Mr. Toan expressed his views.

>> 2024 Forecast: How will interest rates develop after they break through historical bottoms?