tailieunhanh - REGULATION OF INTEREST RATE BY THE STATE BANK OF VIETNAM (SBV)

But, establishing a lower-than-market interest rate by means of a usury ceiling will also bring about a decrease in the quantity of credit supplied. Given lenders costs, the amount of credit they will provide when the interest rate is held down is limited. Like any other business, if a lender does not recoup its costs and earn an adequate return on its resources, it will put those resources to work elsewhere. Since the amount of credit offered will not satisfy all those who are willing to borrow at the ceiling price, excess demand is created, giving rise to a situation in which the reduced amount of credit. | GROUP ASSIGNMENT International Finance REGULATION OF INTEREST RATE BY THE STATE BANK OF VIETNAM SBV Group Members Pham Duc Trung Vu Hieu Trung Phan Tung Nguyen Nguyen Thu Phuong Tran Quoc Loc English Speaking Group 2 Intake 13 CFVG Hanoi HANOI JUNE 2006 International Finance Regulation of Interest Rate by the State Bank of Vietnam SBV Table of Contents 1. The roles of Interest Interest Rate and Consumption Interest Rate and Interest Rate and Exchange Rate Trade Interest Rate and the Financial Balance Among 2. The Interest rates regulating Mechanism by The shock of interest rates during Basic Rate - Period from June 2000 - May Freely Negotiable Interest Rate - Period from June 2002 up to Interest Rate and the Stability Development of Financial Balance among three Objectives of Inflation Control GDP Growth and the Stability of Financial Market . 14 3. recommendation for SBV to regulate Interest Improve the current regulating Set up and perfect indirect monetary Determine clear objectives of monetary Page 2 of 20 International Finance Regulation of Interest Rate by the State Bank of Vietnam SBV Foreword We would like to present to you our study on the Regulation of Interest Rate by the State Bank of Vietnam SBV as our team s assignment for the course of International Finance CFVG Hanoi Vietnam. We hope that this study can give you some information and analysis on the monetary policies of Vietnam. We would like to express our sincere thank to Dr. Michel Henry Bouchet for his lessons and guidance during the course. Pham Duc Trung Vu Hieu Trung Phan Tung Nguyen Nguyen Thu Phuong Tran Quoc Loc MBA Intake 13 CFVG Hanoi June 2006. Page 3 of .

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