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Interest rates rise for dollar deposits
Several commercial banks have increased the annual interest rates they pay on US dollar deposits by 0.2 percentage points to an average of 4.5-5.2 per cent, sparking worries of a new interest rate war.
* Interest rates rise for dollar deposits
Both Asia Commercial Bank and Eximbank have increased interest rates on three-month term deposits to 4.35 per cent and on 12-month term deposits to 4.45 per cent.
Vietcombank is offering 4.5 per cent for a 12-monthterm deposit in US dollars while the Viet Nam-Russia Bank, PG Bank and An Binh Bank are offering rates as high as 5.2 per cent.
"In the latter part of the year the dollar supply is often limited, and to attract dollars, many banks raise interest rates," said Asia Commercial Bank Deputy Director Nguyen Thanh Toai.
Another senior official from the same bank who asked to remain anonymous said that the bank raised interest rates to hold onto its existing depositors and did not want to get involved in a new interest-rate war.
Total foreign currency deposits at the HCM City branch of the State Bank of Viet Nam were down 4 per cent last month against July to about US$8.56 billion, according to the State Bank.
It was too early to tell whether a dollar shortage would solidify into a trend toward higher interest rates, said one treasury official at Vietcombank.
"The third and first half of the fourth quarter are the toughest time," he said. "December is the best time for dollars because of abundant remittance inflows and high export turnover."
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