Vietnam Banks Hike Interest Rate for U.S. Dollar Deposits
Commercial banks in Vietnam have raised interest rates on U.S. dollar deposits by between 0.3% and 0.5% since mid-Aug to as high as 4.5%-5.5% per annum, in a move to lure more greenbacks to cover their shortfall.
Eximbank, one of the country’s largest forex traders, has adjusted up its dollar savings interest rates three times since the State Bank of Vietnam devalued the dong by 2.1% on Aug 18.
The HCM City-based listed lender currently offers 4.95% per annum on six-month U.S. dollar deposits versus 4.45% three weeks ago.
Another well-known dollar-trader Vietcombank is applying an interest rate of 4.5% for a 12-month-term deposit while the rate at smaller lender such as the Vietnam – Russia JV Bank, PG Bank and ABBinh ranges from 5.3% to 5.5%.
Such interest rate increases are expected to help commercial banks balance U.S. dollar supply after the growth of their total outstanding loans in foreign currencies reportedly outstripped that of the forex deposits.
Statistics from the HCM City branch of the State Bank of Vietnam showed that total deposits in foreign currencies at local banks fell 4% from July to US$8.56 billion in August while total outstanding dollar loans were up 1% on-month to US$8.99 billion.
Analysts have believed that higher dollar deposit interest rates will drive up the dollar lending rates at the same time, so the difference between dollar and dong loan rates will be narrowed, encouraging dong credits for the rest of this year. (Labor)
Vietnamese
