Weekly information on banking activities (Dec 25–31, 2010)

1. Mobilizing and lending rates:

- The VND interest rates:

+ The mobilizing rates in VND changed slightly as compared to the previous week, commonly quoted at 13.5% - 14% p.a.. Most credit institutions refrained from promotion programs with cash and interest rate bonus.

+ The lending rates for short terms  were commonly 12.5% – 14.5% p.a for agricultural and  rural development and exporters, 15-18% p.a for other productive and business enterprises, and 18-20% p.a for the non-productive sector.

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

+ The mobilizing rates were  0.2-0.5% p.a for demand deposits, 3.5-5.2% p.a for below 12- month deposits, and 4.2-5.6% p.a for over 12- month deposits. The lending rates were commonly  5.5-6.5% p.a for short terms, and 6-8% p.a for medium and long terms.

The specific mobilizing and lending rates were as follows:

2. Transactions turnover :

According to the express reports of commercial banks by December 29, 2010, the total amount of transactions in the inter-bank market reached about VND 218,825 billion and USD 4,825 million, i.e. VND 36,367 billion and USD 804 million per day averagely. 

Most transactions in VND were overnight, 1 and 2 week terms, accounting for 82% of the total amount of VND transactions of the whole week. The amount of overnight transactions in VND reached 60,204 billion, accounting for 27% of the total amount of VND transactions. The amount of overnight transactions in USD reached 3,074 million, accounting for 64% of the total amount of USD transactions.

3. The average inter- bank interest rates:

The interest rates by December 29, 2010 were as follows:

- For the rates in VND, the average VND interbank interest rates increased by 0.06 – 0.39 percentage point p.a for most terms. However, the average rate for demand term slightly decreased by 0.03 percentage point p.a.

The average overnight interest rate was 10.50% p.a, up by 0.08 percentage point p.a as compared to the previous week. The other rates ranged between 13% - 13.4% p.a. The highest average rate was 13.41% for 3 and 12 month term.

- For the rates in USD, the average interest rates in USD for overnight and 3 month terms increased as compared to the previous week. The average overnight rate slightly increased by 0.03 percentage point and the rate for 3 month term was up by 0.45 percentage point. The average interest rates for other terms decreased by 0.05 – 1.87 percentage point, of which the average rate for 12 month term experienced the sharpest decrease to 1.38% p.a from 3.25% p.a (Down by 1.87 percentage points p.a). The average overnight rate was 0.45% p.a; the other rates ranged between 0.69% -  2.24% p.a. 

There was no transaction for 6 month term. There were a few transactions for 12 month term.

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

4. Exchange rate                                                       

The foreign exchange market continued to show positive signs. The foreign exchange liquidity was improved. The SBV continued to sell foreign currencies to meet the demand for the importation of essential commodities. In addition, the increase of foreign currencies from important capital inflows of the trade balance in the last months of the year contributed to increasing the foreign currency supply in the market. The exchange rates in the parallel market were on the downward trend. The VND/USD rates were commonly quoted by commercial banks at 19,495-19,500.

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