Weekly Information on Banking Activities (June 11- 17, 2009)

The weekly information on banking activities (June 11- 17, 2009) as follows:

1.The Governor of the State Bank of Vietnam (SBV) issued Document No.4471/NHNN-TTR on June 16 to require the General Directors of credit institutions to implement regulations related to personal loans. Accordingly, credit institutions should fully and decisively comply with Item 1 of Instruction No. 01/CT-NHNN dated May 22, 2009 by the SBV on measures of ensuring prudential and effective operations of credit institutions.

Specifically, credit institutions should strictly review and monitor operations of all entities under their jurisdiction in extending personal loans, in particular: complying with the regulations of the Government and the SBV on extending personal loans; applying negotiable interest rates; and conducting inspection and assessing the quality of inspection before, during and after extending personal loans.

Based on the outcomes of these inspections, the General Directors of credit institutions should take proper measures against those banking staff and customers in case of possible offences; and promptly revise and improve professional procedures for more effective and prudent operations and better compliance with law. Credit institutions are required to send their inspection reports to the Financial Supervision Agency before July 15, 2009.

2. During the week, several commercial joint – stock banks namely the Sai Gon Thuong Tin, Dong A, the Vietnam Joint – Stock Technological and Commercial Bank (Techcombank) and the Military Joint-Stock Commercial Bank (MB) increased mobilizing rates by 0.2-0.5 percentage point p.a. The highest interest rate was 10.1% p.a for 36 month - term quoted by the Mekong Delta Housing Development Bank.

- The mobilizing rates in USD of several joint- stock commercial banks namely the Asia Joint – Stock Commercial Bank, Techcombank, and MB continued to decrease by 0.2-0.4 percentage point p.a. in line with supply and demand of capital in the market.

The average mobilizing rates were as follows:

- The lending rates in VND remained stable as compared to the previous week. The lending rates in VND of the group of the state-owned commercial banks for short, and medium and long terms were commonly quoted at 8.5% - 10% p.a, and 10%-10.5% p.a. respectively. The group of joint-stock commercial banks commonly offered their lending rates in VND from 10 % - 10.5% p.a. The lending rates after deducting the amount of interest rate subsidy were from 4.5% to 6% p.a. The negotiable lending rates applicable for personal and credit card loans were commonly at 12% - 16.5% p.a.

- The lending rates in USD were comparatively stable against the previous week. The lending rates in USD of the group of the state-owned commercial banks for short, and medium and long terms were commonly quoted at 3% p.a, and 3.5% - 5% p.a. respectively. The group of joint-stock commercial banks commonly offered their lending rates in USD for short term, and medium and long term at 3% -5% p.a, and 4%-6% p.a respectively.

3. According to the express reports of credit institutions, by June 16, 2009, the average term interest rates in VND in the inter-bank market were on a upward trend for 12 month- term with increases ranged from 0.12 to 0.21 percentage points; the average rates for other terms were on a downward trend. The maximum and minimum decreases were 0.42 and 0.05 percentage points p.a respectively. The average overnight rate was 5.54% p.a., a decrease of 0.42 percentage point as compared to the previous week. The rates of other terms ranged between 6.7% to 8.5% p.a.

The average interest rates in USD in the inter-bank market were on a slight downward trend for overnight and 1 week term, while the rates for other terms were on a upward trend. The highest average interest rate in USD was 2.09% p.a. for 12 months term, the rates of other terms ranged between 0.5%-1.6% p.a.

The average interest rates in the inter-bank market were as follows (% p.a):

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