Vietnamplus

Vietnam’s credit growth has expanded by 8.4 percent from the end of 2018 so far this year, the General Statistics Office (GSO) has reported.

Liquidity in the interbank market has been abundant, helping the State Bank of Vietnam (SBV) resume the issuance of treasury bills after five months to withdraw Vietnamese dong from the banking system.

Banks have to mobilise long-term capital at high costs by issuing certificates of deposit (CD) in Vietnamese dong with high interest rates to lure depositors, causing concerns about a domino effect on lending rates.

Many commercial banks raised deposit interest rates in recent months, triggering worries about the increasing pressure on the lending rates.

Many commercial banks have recently increased deposit interest rates, but experts forecast that the rise will last only a short time and won’t have a domino effect on lending rates.

Many banks have recently reduced deposit interest rates by 0.2-0.4 percentage points against earlier this year due to good capital mobilisation amidst the credit slowdown.

The slow disbursement of public investment has helped increase the State Treasury’s deposits in commercial banks, reducing pressure on interest rates.

Some commercial banks have entered a new interest rate hike race for long-term deposits with adjustments from 0.1-0.2 percent per year.

The fluctuations in deposit rates at the beginning of March were an anomaly and things have returned to normal now, says Deputy Prime Minister Vuong Dinh Hue.

Some commercial banks have entered a new interest rate hike race to lure medium- and long-term deposits, pushing the rate to a record high of more than 9 percent per year.

The State Bank of Vietnam revealed recently that it would continue to keep bank lending interest rates unchanged from last year’s levels.

Several commercial banks have unexpectedly slightly cut the dong-denominated deposit interest rates in the past week, according to report by the State Bank of Vietnam (SBV).

Long-awaited amendments to Circular 36/2014/TT-NHNN regulating prudential ratios for the operations of credit institutions and foreign bank branches were officially issued on May 27.

Credit this year will flow more into production and business instead of non-production industries as done previously, experts said.

Credit growth by February 20 rose 0.39 percent while capital mobilisation increased 0.34 percent against December last year, a government report released early this week said.

The list of banks taking part in the race to raise deposit rates continues to lengthen, and this has taken the interest rate on long-term deposits to 8.4 percent.

After pushing long-term rates to a two-year high of 8.38 percent, some commercial banks continue to raise short-term deposits to the 5.5 percent cap.

Some commercial banks have continuously increased interest rates to attract depositors, setting a record two-year high of 8 percent per year.

Some commercial banks have increased interest rates on dong deposits to meet rising capital demands towards the end of the lunar year.

Average lending interest rate in November reduced 0.28 percent to 9.3 percent per year, the highest slide for the past nine months.