VietNamNet Bridge – Commercial banks have reported they have hundreds of trillions of dong left in their coffers. Tens of trillions of dong have been kept at securities accounts. Many enterprises suffer a headache because they have nowhere to invest in.

The Tuong An Vegetable Oil Company’s (TAC) Q1 finance report showed the sharp increase in the revenue from financial investment activities. Especially, the interests from deposits were 9 times higher than that of the same period of the last year. The balance by the end of the first quarter of 2013 had increased by 25 percent to VND250 billion.

The big volume of cash being kept by TAC and many enterprises shows a big problem of the national economy: the investors cannot find investment opportunities. Since the market demand is weak, enterprises dare not make heavy investment to expand the business scale. As a result, the cash flow has got stuck.

The finance report of Tuong An also showed that the net revenue of TAC in the first quarter decreased to the 13-quarter deepest low.

Analysts have commented that keeping cash and taking cautious in every investment decision proves to be a good choice in the context of the stormy economy. However, it is really problematic that enterprises have money surplus and they don’t know how to use the money.

Binh Minh Plastics Company (BMP) reportedly has the surplus of VND400 billion in the first quarter, which was higher than its chartered capital. The plastics manufacturer had the revenue from finance investments increasing by 8 times in comparison with the same period of the last year, the majority of which came from the bank deposits’ and loans’ interests.

TAC and BMP still have been “living well” in the current big economic difficulties, because they operate in the consumer goods manufacturing sector, which stays safe from the economic crisis. However, even the powerful enterprises also meet problems in expanding their business.

The “money redundancy” has become more serious than ever. In the first 4 months of the year, the banking system reported the credit growth rate of 1.4 percent, which was must lower than the mobilized capital growth rate of 5.34 percent. This means that hundreds of trillions of dong worth of capital still have not been put into the national economy.

Commercial banks, in an effort to optimize the capital use, have poured over VND60 trillion into bonds despite the low interest rates.

Securities companies also have tens of trillions of dong worth of unused capital which they have been depositing at banks, even though the interest rates have been slashed sharply recently, while further decreases have anticipated.

The 95 securities companies which have made public their Q1 finance reports showed that their had VND20,257 billion, not including the deposits under the mode of “short term finance investments.” This includes VND16.6 trillion deposited at banks.

Securities companies don’t know what to do with their big capital to make profit, except depositing money at banks. KLS has VND1.8 trillion deposited at banks, SSI has VND2.7 trillion and VPBS VND1.3 trillion.

Individuals, who have idle money, also don’t know what to do to preserve their money and make profit. The gold price has been fluctuating so heavily. Securities investors keep worries about the liquidity. Meanwhile, the real estate market remains frozen. As a result, the idle money has been flowing to commercial banks, which are believed to be the safest coffers for their money.

Huan Tu