Wednesday,  Oct 24, 2018,06:29 (GMT+7) 0 0
Loan rates expected to fall after Tet
The Saigon Times Daily
Friday,  Dec 1, 2017,15:10 (GMT+7)

Loan rates expected to fall after Tet

The Saigon Times Daily

HCMC - Large banks have hiked their annual deposit rates over the past two weeks to raise more capital to meet the rising demand for loans in the lead up to the Lunar New Year, or Tet, but post-Tet lending rates are expected to fall, according to Dau tu Chung khoan newspaper.

At VietinBank, the rates for six- to nine-month deposits have edged up to 5.8% from 5.5-5.7%. The rates for tenors of 12 months and more than 36 months are 6.8% and 7% respectively.

BIDV has also revised up its interest rates for savings of one and two months to 4.8%. The rates are 5.2% for three-month savings and 6.9% for deposits of nine months or longer.

Le Minh Hung, governor of the State Bank of Vietnam (SBV), said the central bank has told commercial banks to speed up the settlement of bad debt, reduce unprofitable assets and cut interest rates to help enterprises lower costs.

However, interest rates at banks in Vietnam depend on many factors such as capital demand and supply, macroeconomic development, exchange rate stabilization policy and the banking system’s security.

The Government and the central bank will keep inflation low and ensure liquidity at banks to cut lending rates.

Banks currently offer an average annual lending rate of 8% for medium- and long-term loans and 9-10% for other loans.

In addition, interbank interest rates for both Vietnam dong loans and deposits from November 13 to 17 increased by between 22 and 125 basis points for many tenors. The same situation was also seen at transactions in U.S. dollar with an increase of 10 to 166 basis points.

SBV has injected VND20.6 billion (US$0.91 million) via open market operations (OMO) channel and issued VND1.9 trillion worth of new promissory notes while debt falling due this week totaled over VND12.2 trillion.

Thus, the central bank has net injected VND10.305 trillion into the market, taking the total net injections via the two channels to nearly VND10.33 trillion.

According to a report of the National Financial Supervisory Commission, the amount mobilized in the first ten months of 2017 grew 12% over last year while the central bank reported credit growth of 13.66% in the period.

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