State Bank of Vietnam trims prime rates from July 10. (Photo: VNA)

Hanoi (VNA) – The State Bank of Vietnam (SBV) has reduced its prime interest rates and the cap on short-term loan rates as from July 10 to serve demand for capital in some economic sectors.

The refinancing rate, the discount rate and overnight inter-bank interest rates will be cut by 0.25 percent per year. Meanwhile, maximum lending rate for short-term loans will be slashed by 0.5 percent a year.
 
[Interest rates for different terms forecast to drop 0.5-1 percent]

Financial institutions and foreign banks must implement the SBV’s direction while balancing capital to ensure liquidity. They were asked to cut operation costs and enhance efficiency in order to further reduce interest rates for lending to businesses in priority sectors.

The SBV ordered its branches to inspect the implementation of the rate cuts in financial organisations.

To realise the Party and Government’s decrees on socio-economic development this year, the SBV has carried out measures to support liquidity of financial institutions and stabilise interest rates and exchange rates.-VNA