U.S. Dollar Surplus Squeezes Deposit Rates Down
Commercial banks in Vietnam have recently reported a surplus of U.S. dollars, forcing them to cut down the dollar deposit rates, said Head of the State Bank of Vietnam's Foreign Exchange Department Nguyen Quang Huy.
With profuse greenback, commercial banks are interested in dollar-denominated bonds which will be sold by the Vietnamese government this month, Huy added.
In February, Saigon Commercial JS Bank (SCB) adjusted rates of deposits denominated in dollars three times. At present, its highest level is 2.5 per cent per annum for 6-month term deposits, falling by 0.4 percentage point per annum against the previous benchmark.
To encourage customers to borrow loans in dollars, SCB lowered the lending rate of short-term deposits to 4.5 per cent/year and of long and medium term to 4/7 per cent/year.
This showed that banks are promoting lending activities in foreign currency in order to lessen pressures on interest rate.
Meanwhile, Vietnam Export Import Commercial Joint Stock Bank (Eximbank) fixed rates of dollar deposits at 2.6 per cent/year for 12-month term and DongA bank 2.4 per cent/year for 12-month term and ACB 3.2 per cent/year for 36-month term.
While the deposit rate in U.S. dollar has slipped, the dong deposit rate has tended to increase since late February.
From March 18, VPBank continued to increase the dong saving rate by 0.03-0.55 percentage point to 3.85 per cent-7.85 per cent upon each terms. (Vietnam Economic Times)
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