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Major banks lower deposit rates
The Saigon Times Daily
Thursday,  Dec 7, 2017,23:18 (GMT+7)

Major banks lower deposit rates

The Saigon Times Daily

HCMC – A couple of large commercial banks have adjusted down their annual deposit rates after a short time of hiking them, according to An Ninh Thu Do newspaper.

VietinBank has cut interest rates for deposits of six to less than nine months to 5.3% and nine- and ten-month tenors to 5.5%. At BIDV, the interest rate for savings of one and two months are now 4.3% while three- and five-month savings get an interest rate of 4.8%.

The interbank market also saw a plunge of 0.26%-0.71% in interest rates for overnight, one-week and two-week tenors.

According to Bao Viet Securities JSC (BVSC), the State Bank of Vietnam (SBV) has issued VND28.8 trillion (US$1.27 billion) worth of promissory notes while debts falling due this week totaled over VND10.3 trillion. Thus, the central bank has net withdrawn VND18.5 trillion from the system.

The decline in interbank interest rates and the SBV’s net withdrawals show ample liquidity in the banking system, said BVSC.

In previous years, banks had difficulty securing sufficient liquidity due to high demand for capital and a fall in deposits.

Experts explained that credits have increased gradually and call deposits have remained large as funds for public investment projects have not been disbursed. The target to raise capital from Government bond sales has been achieved earlier than in previous years.

In addition, growth on the stock market has helped commercial banks access to medium- and long-term loans, easing the pressure on the banking system.

Other reasons are abundant foreign currency inflows, high trade surplus, steady foreign direct investment (FDI) and official development assistance (ODA) disbursements, strong incoming remittances and good tourism revenue.
VietinBank earlier hiked its interest rates for deposits of six to less than nine months from 5.5-5.7% to 5.8%. The rate for the 12-month tenor also increased 30 basis points to 6.8%.

Meanwhile, BIDV revised up its interest rates for deposits of one and two months to 4.8%. The rates were 5.2% instead of 4.8% for three-month savings.

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