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Weekly Information on Banking Activities (March 19-23, 2009)
The weekly information on Banking Activities (March 19-23, 2009) is as follows:
1. The State Bank of Vietnam (SBV) on March 24 issued an announcement related to several interest rates applicable from April 1st as follows :
The base interest rate remains unchanged at 7% p.a., the refinancing interest rate is 8% p.a., the discount rate is 6% p.a., and both the overnight rate in the inter-bank electronic payment and the rate of loans to finance short balances in clearing transactions between SBV and commercial banks is 8% p.a.
2. The money market remained stable. The VND mobilizing interest rate slightly increased with a rise between 0.1%-0.3% p.a., while the mobilization interest rate in USD offered by joint-stock commercial banks slightly reduced between 0.1%-0.2% p.a. in comparison with the previous week, the rates are quoted as follows:
|
The average mobilizing rate
|
Currency |
Demand
(% p.a) |
3 months
(% p.a) |
6 months
(%p.a) |
12 months
(% p.a) |
|
Group of state- owned commercial banks |
VND |
2.76 |
7.07 |
7.25 |
7.56 |
|
USD |
0.66 |
2.00 |
2.34 |
2.95 |
|
Group of joint-stock commercial banks |
VND |
2.91 |
7.48 |
7.63 |
7.84 |
|
USD |
1.00 |
2.07 |
2.23 |
2.54 |
- The lending rates in VND of the group of state-owned commercial banks remained unchanged in comparison with the previous week, commonly at 8.5%-10% p.a. for short-term loans and at 10%-10.5% p.a. for the medium and long-term loans in VND.
- The common lending rates in VND of the group of joint-stock commercial banks remained stable are commonly at 10% - 10.5% p.a.
3. According to the express reports of credit institutions, by March 24, 2009, the average interest rates in VND in the inter-bank market were generally stable in comparison with the previous week. The average overnight and 3 months rates slightly decreased while the rates of 1 week, 2 weeks, 1 month, and 6 months were on slight upward trend as compared to the previous week.
The average overnight rate was 6.5% p.a., the rates of other terms ranged between 7.3%-8.5% p.a.
The average interest rates in USD were on downward trend for almost terms, except 6-month term loans (an increase by 0.69% p.a.). In general, the interest rates in USD fluctuated between 0.5%-3% p.a. There was no transaction for 3 month loan.
The average interest rates in the inter-bank market were as follows (% p.a):
|
Term |
Overnight |
1
week |
2
weeks |
1
month |
3
month |
6
month |
12
month |
|
VND |
6.5 |
7.33 |
7.52 |
7.72 |
8.04 |
8.48 |
- |
|
USD |
0.49 |
0.95 |
0.98 |
1.13 |
- |
2.58 |
1.10 |
4. On March 23, the Governor of State Bank of Vietnam (SBV) issued Decision No. 622/QD-NHNN to allow credit institutions to raise their daily trading band for the US$/VND exchange rate to ±5% against the inter-bank rate. The decision came into effect from March 24.
The new regulation facilitates the exchange rate to move more flexibly and fairly reflects the foreign exchange supply and demand while creating favorable conditions for commercial banks and enterprises to proactively work out their business plans for 2009.
After the issue of this Decision, the foreign market moved toward positive trend, foreign currencies transactions became actively, the foreign currencies liquidity was enhanced, especially the inter-bank foreign currency market operated positively.
The VND/USD exchange rate fluctuated significantly at the beginning days of issuing Decision No. 622. However, the situation returned to stable gradually and was in downward trend. Presently, commercial banks offered their selling VND/USD exchange rate at around 17,650-17,800 VND/USD. The SBV closely watched the developments in the market, managed the exchange rate flexibly to control trade deficit and stabilize macro-economy.
5. SBV Management Board’s activities
- March 20, the Asian Development Bank (ADB) and the Government of Viet Nam signed an agreement for a US$410.2 million loan to build the 51-kilometer Ho Chi Minh City-Long Thanh-Dau Giay expressway. The entire project will cost $932 million, with other funding coming from the Japan International Cooperation Agency (JICA) and the Viet Nam Expressway Corporation.
- March 21, the Governor Nguyen Van Giau paid a working visit to the Vietnam Bank for Agricultural & Rural Development.
- March 25, the SBV Governor had working visits with representatives of local authorities, SBV branches and commercial banks in Hung Yen and Ninh Binh provinces in order to review the implementation of Decision No. 131/QD-TTg and Circular No. 02/TT-NHNN.
- March 26, the SBV Governor chaired meetings with the Working team to support SMEs in Hanoi in order to resolve any difficulties and problems arising from the implementation of the program.
- March 23, Deputy Governor Nguyen Toan Thang attended and made speeche at a graduate program in International and Development Economics (IDEC) for 16 SBV staffs. The program was held by a coordination between SBV and the Australian National University (ANU).
- March 24, Deputy Governor Nguyen Van Binh of the State Bank of Vietnam (SBV) joined Mr. Ayumi Konishi, Country Director of the Resident Mission of the Asian Development Bank (ADB) in Vietnam, in singing on March 24 a grant agreement to prepare a project of “Developing sustainable rural infrastructure in the northern mountain provinces”.
- From March 23-27, Deputy Governor Nguyen Dong Tien paid working visits in Central Highland provinces.
- From March 23-27, Deputy Governor Dang Thanh Binh had oversea visits to China and Japan in order to study and exchange experiences of vaulting and banknote issuing operations.
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