Weekly information on banking activities (Jan 1 – 7, 2011)

1. Mobilizing and lending rates:

- The VND interest rates:

+ The mobilizing rates in VND changed slightly as compared to the previous week, and were 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 January 5, the total amount of transactions in the inter-bank market reached about VND 128,880 billion and USD 3,066 million, i.e. VND 32,220 billion and USD 766 million per day averagely. 

Most transactions in VND were overnight and 1 week terms. The amount of 1 week transactions in VND reached 56,898 billion, accounting for 44% of the total amount of VND transactions. The amount of overnight transactions in USD reached 1,423 million, accounting for 46% of the total amount of USD transactions.

3. The average inter- bank interest rates:

The interest rates by January 5 were as follows:

- For the rates in VND, the average VND interbank interest rates slightly decreased by 0.01 – 0.06 percentage points p.a for several terms (1 week, 6 month, 12 month and demand terms. The average rates for 1 and 3 month terms were unchanged as compared to the previous week. The rates for overnight and 2 week terms increased by 0.06 and 0.07 percentage points p.a respectively.

The average overnight interest rate was 10.56% p.a, up by 0.06 percentage point p.a as compared to the previous week. The rates for 2 week to 3 month terms were relatively high, above 13% p.a. The average rates for 6 and 12 month terms were down to 12.81% p.a and 12.88% p.a respectively. The highest average rate was 14.5%. The lowest rate was 5% p.a (Excluding demand term).

- For the rates in USD, the average interest rates in USD for overnight, 1 and 12 month terms were on upward trend as compared to the previous week. The rates for 2 week and 6 month terms were on downward trend. The average interest rate for 1 week term was unchanged. The average overnight rate was 0.50% p.a; the other rates ranged between 0.69% - 4.36% p.a. 

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. Commercial banks could buy foreign currencies from the market and sold to their customers. The SBV continued to sell foreign currencies to meet the demand for the importation of essential commodities. In addition, the increasing foreign currency amount from important capital inflows of the trade balance in the final months of the year contributed to enhancing 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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