Weekly information on banking activities (Oct. 15 - 21, 2010)

1.Mobilizing rates:

- The mobilizing rates in VND declined averagely by 0.14 percentage point  p.a in comparison with the previous week as per an agreement reached among members of the Vietnam Banks’ Association recently, the rate in most commercial banks was  cut down by 0.1 - 0.2 percentage points p.a to the maximum rate of 11% p.a from October 15 (At 3% p.a for demand deposits, 8.52% p.a for below 1 month term, 11% p.a for 1 - 12 month terms and 10.86% p.a for over 12 month term).

- The mobilizing rates in USD were stable as compared to the previous week.

The specific mobilizing rates were as follows:

2. Lending rates

The average VND lending rate was down by 0.1 percentage point p.a as compared to the previous week. The lending rates for priority areas (Agricultural, rural and export) declined by 0.3 - 0.5 percentage points p.a,. It is notable that the Bank for Foreign Trade of Vietnam, the Bank for Investment and Development of Vietnam, and the Vietnam Bank of Agricultural and Rural Development reduced the lending rates for priority areas to 10.5% - 12.3% p.a.

The USD lending rates were stable as compared to the previous week.

The specific lending rates in VND and USD were as follows:

3. Transactions turnover:

According to the express reports of commercial banks, the total amount of transactions in the inter-bank market reached about VND 122,758 billion and USD 2,669 million, i.e. VND 24,552 billion and USD 534 million per day averagely.

Most transactions in VND were short terms (Overnight, 1 and 2 weeks), of which the amount of overnight transactions in VND was 53,351 billion, accounting for 43% of the total amount of transactions in VND. The amount of overnight transactions in USD was 1,396 million, accounting for 52% of the total amount of USD transactions.

4. Interest rates:

For the rates in VND, the average VND interbank interest rate for most terms increased, of which the rates for overnight and demand terms slightly rose. The rates for 1 and 2 weeks, and 1 and 12 months were up by 0.41 - 0.75 percentage points p.a. The rate for 3 months increased by 1.37 percentage point p.a, to 10.98% p.a.. The rate for 6 months decreased by 0.46 percentage point p.a.

The average overnight rate was 7.30% p.a. The rates for over 3 months were around 11% p.a. The rate for 12 months was 11.56% p.a. The highest lending rate was 12% p.a. while the lowest rate was 6% p.a. (excluding the demand loan rate).

For the rates in USD, the average interest rates in USD for overnight, 2 weeks and 6 months decreased by 0.02, 0.3 and 0.4 percentage points p.a respectively. The rates for 1week and 1 month slightly increased. The rate for 3 months was up by 0.24 percentage point p.a. There was no transaction in USD for demand and 12 month loans.

5. Exchange rate

The exchange rate quoted by commercial banks was close to the ceiling rate, at 19,490 - 19,500 VND/USD. The SBV continued to monitor the developments in the forex market in order to manage the exchange rate in a stable manner.

Diem Hang

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