Hanoi (VNS/VNA) - Most domestic credit institutions and foreign banks’branches in Vietnam expect their business performance in 2019 to be better thanlast year despite the predicted slowdown in credit growth, according to theState Bank of Vietnam's latest survey released late last week.

In thesurvey, which covered all domestic and foreign banks in the country, some 91 percentof credit institutions forecast their pre-tax profits in 2019 to grow againstlast year, whereas 3 percent expected them to remain unchanged.

Amajority of the credit institutions participating in the survey stated thattheir business performance in the third quarter had improved significantly,compared with the previous quarter.

Up to82.3 percent of credit institutions expect their fourth-quarter businessresults to be better than those seen in the previous quarter, according to thesurvey.

Accordingto the survey, liquidity in terms of both the Vietnamese dong andforeign currencies of the banking system by the end of the third quarter remainedgood. A total 55 percent of banks expected the positive trend would continuefor the rest of the year.

Accordingto the survey, outstanding loans at banks are expected to edge up by 4.85 percentin the fourth quarter and expand by 13.61 percent this year. The predictedcredit growth for 2019 is a bit lower than the 14 percent target set by theSBV.

Apartfrom credit growth, capital mobilisation in the banking sector is forecast torise by 4.39 percent in the fourth quarter of 2019 and 13.06 percent this year,down 0.42 percentage point compared with the level in the previous surveyconducted in June this year.

Thecentral bank’s recent report showed that as of September 26, credit growth wasrecorded at 8.64 percent and capital mobilisation rose by 9.03 percent againstthe figures seen in early 2019.

Asidefrom this, the survey found that demand for loans will continue its upwardspiral, higher than the demand for payments, cards and deposit accounts.

Accordingly,some 68-73 percent of credit institutions expect the demand for bankingservices to surge for the rest of the year.

Notably,the survey showed the resolution of non-performing loans (NPL) at banks hasshown positive signs, with 27.6 percent of banks reporting their NPL ratiodeclined in Q3 and 28.9 percent expected a drop in Q4. The rates are higherthan 27.4 percent and 26.9 percent in the previous survey conducted in Junethis year.

Thesurvey also indicated that many banks saw a reduction in credit risk in thethird quarter./.