Banks raise deposit rates ahead of SBV rules
Lenders can get benefits as commercial banks have recently raised their deposit interest rates — Photo: nld.com.vn
Under Circular 06/2016/TT-NHNN, commercial banks will have to lower the ratio of short-term funds used for medium and long-term loans from 60 per cent to 50 per cent from January 1, 2017 to December 31, 2017.
In the past, many lenders used short-term funds for medium and long-term loans. Because of this, they are now forced to increase the interest rate of Vietnamese đồng deposits to attract more capital to meet the requirement.
The Bản Việt Commercial Joint Stock Bank typified the trend. On September 5, the bank raised its six-month Vietnamese đồng deposit rates by 0.1 percentage points to touch 7.1 per cent per year. Meanwhile, the interest rate of its 13-month term deposits was increased from 7.5 per cent per year to 7.8 per cent per year.
Earlier, VPBank also announced, effective from September 1, a rise of 0.2 percentage points in the one-month and two-month deposits, which are now 5 per cent and 5.2 per cent per year, respectively. Meanwhile, the rates for three-month deposits was adjusted from 5.2 per cent per year to 5.3 per cent per year.
To attract more long-term capital, the bank also raised the interest rates by 0.1 percentage points for those deposits with 13 and 15 month terms.
In its new rate list, Eximbank also increased its short-term deposit rate by 0.3 and 0.4 percentage points to touch 5 per cent and 5.5 per cent.
Leaders of some commercial banks said the raising deposit interest rates was designed to ensure liquidity.
Many commercial banks have boosted long-term loans, which now account for up to 80 per cent of short-term funds for real estate projects.
So, from now to year-end, many banks are seeking to increase liquidity shortages to be able to meet the central bank’s request. Meanwhile, the amount of money that the lenders borrowed from other banks are not included in their capital sources.
This has encouraged many commercial banks to adopt measures to actively seek capital, especially those with long-terms to provide against a possible breakdown of liquidity.
Due to the deposit rate hikes, there is some concern that a lending interest rate hike is imminent.
However, the SBV said in a report released recently that it would ask commercial banks to keep lending rates stable over the remaining months of the year.
SBV said it would continuously instruct commercial banks to balance their capital sources and lending capital sources to stabilise deposit interest rates in the remaining months of the year.
Better business performance and lower input costs are also required for maintaining lower lending rates.
As a result, lending interest rates have been rather stable despite the fact that the banks are competing with each other to raise their deposit interest rates.
In August, for instance, lending interest rates were 6 per cent to 9 per cent for short-term loans and 9 per cent to 11 per cent for medium-long loans./.
Source: VNS
See also

Intertwined opportunities, challenges for Vietnam’s economy in 2023
07:00 | 30/01/2023 Economy

Industry and trade sector drives development
06:00 | 22/01/2023 Economy

The right direction for Lam Dong to break through into the global supply chain
08:58 | 10/01/2023 Economy

Nghe An Province increases local content of industrial products
06:00 | 06/01/2023 Province

Vietnam records best-ever performance in digital economic development
16:51 | 03/01/2023 Digitalization

Vietnam looks to market forces to boost growth
06:00 | 02/01/2023 Economy
See more news

The path to fostering green exports
06:00 | 30/12/2022 Trade

Mastercard Economics Institute: Economic Outlook 2023
11:04 | 27/12/2022 Economy

Ba Vi, the place to buy Hanoi specialties
15:00 | 26/12/2022 Metropolis

Rural products fall short of potential
10:00 | 24/12/2022 Industry promotion

Mitsubishi Power to upgrade two gas turbines at Tuas Power
09:45 | 20/12/2022 Energy

Trade deals: The good, bad and unpredictable
06:00 | 20/12/2022 Trade

Industry-trade sector eases regulation
06:00 | 15/12/2022 Economy

Two 2023 growth scenarios for Vietnam
06:00 | 13/12/2022 Economy

PM: Green economic development a top priority
06:00 | 12/12/2022 Economy

Ha Giang Province improves lives
11:00 | 10/12/2022 Province

Lao mission in Geneva joins Vietnamese counterparts on Lunar New Year festival
07:04 | 30/01/2023 Vietnam and ASEAN

Intertwined opportunities, challenges for Vietnam’s economy in 2023
07:00 | 30/01/2023 Economy

Tourism is back, big time
06:00 | 30/01/2023 Tourism

Việt Nam supports expansion of UN Security Council
06:00 | 30/01/2023 Policy

Trang A Chu’s unique homestay
06:00 | 29/01/2023 Entertainment
Multimedia

Norwegian Ambassador experiences Vietnamese Tet traditions
06:00 | 28/01/2023 Lifestyle

Fireworks soar across Vietnam ringing in Year of the Cat
13:07 | 22/01/2023 Photo

The cat in Vietnamese culture
13:00 | 22/01/2023 Lifestyle

Sa Dec Flower Village, an attractive destination in Tet
16:11 | 11/01/2023 Tourism

Da Nang tops Vietnam's tourism competitiveness rankings
15:37 | 11/01/2023 Longform

Việt Nam supports expansion of UN Security Council
06:00 | 30/01/2023 Policy

Prime Minister assigns tasks to Deputy Prime Ministers
07:00 | 17/01/2023 Policy

Taking advantage of growth opportunities: Party leader
09:18 | 04/01/2023 Policy

Financial mobilization for development of circular economy
17:02 | 03/01/2023 Policy

Binh Lieu mountain region powers up
06:00 | 28/01/2023 Province

Steel industry to gradually recover in 2023
15:48 | 27/01/2023 Industry

Quang Ninh ships first tonne of coal on first day of Lunar New Year
18:16 | 23/01/2023 Energy

Support industries vital for global integration
06:00 | 18/01/2023 Support industries

Viet Nam calls for more investment in green growth
16:52 | 22/01/2023 FDI

Hanoi attracts nearly US$1.7 billion in FDI in 2022
17:43 | 03/01/2023 Metropolis

FDI disbursement exceeds US$20 billion
06:00 | 01/01/2023 FDI

Screening proposed for improved foreign investment
06:00 | 21/12/2022 FDI

Positive 2023 securities market forecasts
06:00 | 20/01/2023 Stock Market

Banking sector stable, but challenges abound
06:00 | 16/01/2023 Finance-Banking

PM directive to ensure payment demands during Tet
17:55 | 03/01/2023 Finance-Banking

Green finance puts down roots in Vietnam
06:00 | 26/12/2022 Finance-Banking

Vietnam looks ahead to 2023 climate summit
06:00 | 25/12/2022 Environment

Preserving nature, facilitating business
06:00 | 10/12/2022 Environment

AkzoNobel Vietnam protects Cu Lao Xanh lighthouse against harsh weather
11:40 | 24/11/2022 Environment

JTI Vietnam commits to net zero greenhouse gas emissions
16:25 | 15/11/2022 Environment

Welcoming the year of digital data for Vietnam
16:57 | 22/01/2023 Digitalization

Vietnamese animation studio won legal case on copyright infridgement in Russia
11:14 | 11/01/2023 Startups

Top 10 ICT developments in 2022
06:00 | 11/01/2023 Information technology

First retrofitted Emirates A380 enters service
17:41 | 10/01/2023 Science - Technology

Prime Minister launches New Year tree planting festival
15:36 | 27/01/2023 Society

Party General Secretary extends greetings for Year of the Cat
12:19 | 22/01/2023 Metropolis

Strong recovery of capital's economy
06:00 | 17/01/2023 Metropolis

Animated morning at Nghi Thuy fishing port, Cua Lo Town
10:48 | 16/01/2023 Photo

Nestlé Vietnam and the journey to sustainable development
13:00 | 10/01/2023 Companies

VIMC embarks on strong recovery
06:00 | 10/01/2023 Companies

MM Mega Market launches a new modern Giá tốt business model
16:18 | 30/12/2022 Vietnamese Brands

PVCFC develops experts’ system
08:00 | 25/12/2022 Vietnamese Brands

Norwegian Ambassador experiences Vietnamese Tet traditions
06:00 | 28/01/2023 Lifestyle

Chau Ma brocade lives on
06:00 | 27/01/2023 Lifestyle

Bathing in coriander-filled water
13:00 | 25/01/2023 Culture

Gongs keep ringing in Central Highlands
06:00 | 25/01/2023 Lifestyle

Tourism is back, big time
06:00 | 30/01/2023 Tourism

Trang A Chu’s unique homestay
06:00 | 29/01/2023 Entertainment

Miss Tourism World contest promotes Vietnam
06:00 | 26/01/2023 Tourism

Sa Dec Flower Village, an attractive destination in Tet
16:11 | 11/01/2023 Tourism