Vietnam Commercial Banks Slightly Hike Deposit Rates
Deposit interest rates offered by domestic commercial banks have been increasing between 0.2-1.5 percentage points per annum, according to the State Bank of Vietnam (SBV).
At present, the average interest rate for dong deposits stood at 7.1 per cent-8.6 per cent per year while those for loans remained stable at 8-10.5 per cent per year.
State-owned banks which previously offered to provide loans at rates above 10.5 per cent per annum have already lowered the rate to 10.5 per cent at maximum, the SBV said.
Deposit rate increases are believed to help commercial banks attract more capital to serve disbursement plans as the 4 per cent lending interest rate subsidy programs are in full swing.
Experts have recently raised concerns over a situation that businesses can borrow money at low rates under the subsidy program and then deposit the money at banks to enjoy the interest rate margin.
The director of a Hanoi-based commercial bank said that in principle businesses always consider how to use their money in the most effective way.
“However, it is not so easy to borrow money from one bank to deposit at another bank, because all banks, fearing credit risks, are trying to control disbursement strictly,” he said.
The situation occurs only when banks’ staffs do not closely make regular periodic examinations of disbursed money, he added.
Deposits at banks in Vietnam have risen 9.88 per cent since early 2009 while total outstanding loans have jumped 11.16 per cent. (Vietnam Economic Times)
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