|
Deposits trickle in despite better banking incentives
Though banks have begun a deposit-interest-rate war to mobilise funds for lending, they are not attracting as much money as they had hoped for.
An Binh Commercial Joint Stock Bank (ABBank) has increased rates by 0.1 to 0.9 per cent. It offers 8—8.5 per cent for deposits of three to nine months, 8.7 per cent for 12-month deposits, and 9.5 per cent for 60 months.
The Maritime Commercial Joint Stock Bank (Maritime Bank) and VPBank have also raised their rates.
Even some State-owned banks have joined in the race to attract deposits – the Viet Nam Bank for Industry and Trade (Vietinbank) typifies the trend. The bank has announced an issue of certificates of deposits in dong at an interest rate of 9 per cent, which would climb to 9.3 per cent for certificates with a face value of above a certain amount.
The NamViet Commercial Joint Stock Bank upped its 36-month deposit rate to 10 per cent.
The hikes mean the interest rates are closing in on the ceiling loan rate of 10.5 per cent stipulated by the State Bank of Viet Nam.
Bankers said the shrinking spread – or the difference between the deposit and loan rates – meant the banks would find it difficult to make profits, which could only be ensured if there was a spread of at least 3 per cent.
So, despite knowing this, the banks are having to increase deposit interest rates since they have to compete for the customer’s dong with stocks, gold, and foreign exchange.
Response tepid
But despite the banks’ efforts, deposits are only trickling in.
According to the central bank, credit growth in April was 4.86 per cent month on month and 11.6 per cent since end-2008, while deposits grew by only 3.74 per cent and 9.88 per cent.
Pham Duy Hung, general director of the Viet A Commercial Joint Stock Bank (VietA Bank), admitted that despite hiking rates several times, deposits at his bank only increased slightly.
Ly Xuan Hai, general director of the Asia Commercial Joint Stock Bank, said by mid-May deposits, at VND94.12 trillion (US$5.2 billion), were up by 25 per cent since January while outstanding loans rose by 29 per cent.
VietA Bank said that in April deposits rose only VND280 billion month on month, or 3.5 per cent, to VND8 trillion. Loans outstanding were up by almost 6 per cent in the same period.
SBV Governor Nguyen Van Giau recently issued a directive asking lenders to mobilise more deposits and ensure balance between sources and use of funds.
"Banks have to closely monitor credit activities to ensure that their long-, medium-, and short-term loans are proportionate to their deposit terms," he said.
vietnamnews
|
