The banks affected by the fiat include Argibank, Vietcombank, Vietinbank, BIDV and Mekong Housing Bank. All are required to report what action they have taken on these three fronts to the State Bank and the Ministry of Finance by April 10, 2012.

State-owned commercial banks are normally the first lenders to reduce lending rates. State Bank figures show the lowest lending rate for businesses is generally 15 per cent. For agriculture enterprises and exporters, the lowest level is 13.5 per cent.

However, enterprises are still claiming it is too difficult to access low-cost capital. Phan Thanh Tinh, chairman of HT Company in Dong Nai province, said BIDV and Agribank’s lending rates in the province were in the 16.5–17 per cent range for firms like HT. “This is still high for us,” he said.

Nguyen Van Tao, chairman of Nam Viet Fertiliser in Binh Duong province, said many companies were borrowing at 20 per cent, while a dearth of collateral assets was a road block for others.

BIDV deputy director Pham Quang Tung said the low rate only applied to enterprises with good credit ratings, which had long-term relationships with the bank.

“For new customers, it will take time for banks to evaluate their credit risks. Moreover, some companies do not provide transparent business results so it will be hard for banks to lend,” said Tung.

The banking system restructuring plan, approved by Prime Minister Nguyen Tan Dung at the beginning of March this year, will enhance the steering role of state-owned commercial banks to ensure they are the driving force and the back bone of the banking system. Thus, the reduction in these banks’ lending rates will push joint stock commercial banks to reduce their rates in the near future.