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Deposit interest rates higher than lending rates
With the 4% lending interest rate subsidy programme, lending interest rates have become even lower than deposit interest rates.
Under the current laws, with the basic interest rate of 7% per annum, the ceiling lending interest rate is 10.5%. However, with the 4% interest rate subsidy programme, businesses are borrowing money at 6.5% at maximum. In many special cases, loyal clients can get preferences from banks, enjoying lending interest rates of less than 6.5%.
Meanwhile, deposit interest rates applied by commercial banks are higher than 6.5%. At Vietcombank, for example, the rate is 7.3% per annum for 3-month term deposits, 7.5% for six-month term deposits, and 7.7% per annum for 12-month term ones. The deposit interest rates applied by Vietinbank are 7% per annum for 3 month-term deposits, 7.2% for six-month, and 7.7% for 12-month.
At Habubank, the interest rate for 3-month term deposits is 7.7% per annum, while the rate for the six-month is 7.9% per annum, and 8.2% for the 12-month. The rates applied by Techcombank are 7.45%, 7.65% and 7.9% per annum, respectively, and the SCB’s rates are 7.85%, 8.1% and 8.2% per annum.
It has been asked if the situation will prompt businesses to borrow money at low interest rates under the interest rate subsidy programme and then deposit the money at banks to enjoy the interest rate margin.
The director of a Hanoi-based commercial bank said that in principle, the thing is possible, as businesses always consider how to use their money in the most effective way.
“However, it is not so easy to borrow money from one bank to deposit at another bank, because all banks, fearing credit risks, are trying to control disbursement strictly,” he said.
The director said that it is quite normal that businesses borrow money from banks though they still have money in their coffers. Businesses often borrow money because they have to make reserves for liquidity and prepare for payment items that are coming due.
Meanwhile, Tran Phuong, Director of the Planning and Development Division under the Bank for Investment and Development of Vietnam (BIDV), affirmed: “It is impossible for businesses to borrow money from one bank to deposit at another bank.
“The thing occurs only when banks’ staffs do not strictly control the disbursement process. If staffs make regular periodic examinations of disbursed money, businesses would not be able to use money for improper purposes,” he said.
The VND interbank interest rate is tending to increase on all terms of loans. The interest rate has reached 9% per annum for 12-month term loans.
VietNamNet, DTCK
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