Vietnam inspectors say banks gave loans to wrong borrowers

Vietnam International Bank, Military Bank, Techcombank, Sacombank and Asia Commercial Bank are being blamed for a loss of around US$7.6 million to the state budget.

According to a VnExpress report, Vietnam's state inspectors found that the five banks offered the subsidies to ineligible borrowers.

Under the interest rate subsidy plan, a part of the 2009 economic stimulus package, the government subsidized 4 per cent of medium- and long-term loans taken by local businesses.

The interest rate subsidy aimed to help major export manufacturers maintain production amid the global economic downturn.

Some cash-rich companies were given loans at subsidized rates and then they deposited the money to earn profits. Others received more money than they should, due to poor assessment procedures by the lenders.