Credit growth negative for last two months The credit growth of the banking system as of Tuesday stood at minus 0.16% against late 2012, versus minus 1% in January and minus 3% in the same period last year, according to the Credit Department of the State Bank of Vietnam (SBV). The credit growth for 2013 is set at 12%, counting banks’ investment in government bonds. A senior source from SBV said whether this target can be achieved or not greatly depends on the capital absorptive capacity of the economy and the health of enterprises. The Credit Department said it would continue to strictly manage credit quality of banks to prevent capital from flowing into inappropriate places, producing no effect. Classification of credit groups will be announced soon. SBV will take into account governance capacity and capital scale of each bank and then list them into groups with specific credit growth limits. Strong banks that have already merged with weak banks resulting in higher bad debt ratios may be reclassified into other groups with lower credit growth limits. Meanwhile, small healthy banks may join the groups with high credit growth quotas. The classification is aimed at preventing banks from careless lending practices, exerting an impact on inflation, as enterprises in Vietnam heavily depend on loans for operations. In 2012, banks were classified into four credit groups. The first was allocated a credit growth quota of 17%, while the limits for the second and the third groups were 15% and 8% respectively….