Treasury puts 10.5 billion USD in five banks hinh anh 1Vietcombank's transaction office (Photo: Vietcombank)
Hanoi (VNA) - The State Treasury deposited more than 238.49 trillion VND (10.5 billion USD) in five commercial banks by the end of last year, up 3.3 times against January.

Dien dan doanh nghiep (Business Forum) newspaper reported that these banks are Vietcombank, BIDV, VietinBank, MBBank and VIB.

Vietcombank received the largest proportion of the deposits, at nearly 165.1 trillion VND, three times higher than the end of September. The State Treasury’s deposits at Vietcombank included a recent State divestment deal from Sabeco, worth 5 billion USD, or more than 113 trillion VND.

The Treasury also deposited nearly 11.1 trillion VND in Vietinbank by the end of last year.

According to experts, inter-bank interest rates plunged because of massive capital flows into the Vietnamese market and difficulties in public investment disbursements, prompting the State Treasury to transfer large deposits from the State Bank of Vietnam to commercial banks last year.

In contrast to previous years when liquidity was typically short at the end of the year due to the rise in payment needs, the liquidity of the banking system at the end of 2017 remained abundant, partly thanks to the State funds, the experts said.

Saigon Securities Incorporation (SSI) said the good liquidity at the banking system last year was primarily because of the reasonably controlled credit growth (18.1 percent) and secondly due to the slow disbursement of public investment, which was why a large amount of the State Treasury’s capital was deposited in the five banks.

Moreover, the situation was also attributable to the surplus in the balance of payments, the high foreign exchange reserve and the increase in the domestic currency supply to the market from the SBV, SSI said.

Earlier in July last year, the Vietnam Institute for Economic and Policy Research also reported the State Treasury’s deposits in the banking system are considered the main reason for the high liquidity in the market.

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

With the abundant liquidity in the banking system, commercial banks last year also increased their investment in long-term bonds. Earlier, bonds with a tenure of 30 years were mainly bought by insurance companies, but last year saw a drastic shift when banks bought nearly 15 trillion VND out of 28 trillion VND worth of 30-year bonds.-VNA