Weekly information on banking activities (Feb 12 – 18, 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. Only the Asia Joint-Stock Commercial Bank launched the savings promotion program under the name of "Loc vang ACB" with gold bonus, making the highest real mobilizing rate as 19.76% p.a. However, from February 18,  ACB terminated such promotion program.

+ The lending rates for short terms were commonly 14.5% p.a for agricultural and rural development and exporters, 16-18% p.a for other productive and business enterprises, and 18-20% p.a for the non-productive sector.

- The USD interest rates:

+ The mobilizing rates were relatively stable. The common mobilizing rates were 0.2-0.5% p.a for demand deposits, 4.2-5.8% p.a for below 12- month deposits, and 4.5-6.0% p.a for over 12- month deposits. The highest interest rate was 6.24% p.a for 12 month term quoted by the Nam Viet Joint-Stock Commercial Bank.

+ The lending rates were commonly 6-6.6% p.a for short terms, and 7-8% 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 February 16, the total amount of transactions in the inter-bank market reached about VND 115,480 billion and USD 3,219 million, i.e. VND 23,096 billion and USD 644 million per day averagely. 

Most transactions in VND were overnight and 1 week terms that accounted for 78% of the total amount of VND transactions. Transactions in USD was mainly overnight with an amount of USD 2,133 million, accounting for 66% of the total amount of USD transactions.

3. The average inter- bank interest rates:

The interest rates by February 16 were as follows:

- For the rates in VND, the average VND interbank interest rates for most terms decreased by 0.02 – 1.93 percentage points p.a, of which the average overnight interest rate registered the most remarkable decline to 11.30% from 13.23% (Down by 1.93 percentage points p.a); The average rates for 1 week and 2 week terms were remarkably down. The average rates for other terms slightly decreased. The average rate for 6 month term was unchanged.

The average rates for  2 week –plus terms ranged between 13% and 13.5% p.a.

- For the rates in USD, the average interest rates in USD were on a upward trend for most terms as compared to the previous week, commonly up by 0.01 – 0.31 percentage points p.a. The average rate for 3 month term rose to 2.61% from 1.62%, up by 0.98 percentage point p.a, The average rate for 6 month term declined to 3.13% p.a, down by 0.63 percentage point. The average overnight rate was 0.48% p.a, up by 0.01 percentage point p.a. The average rates for other terms ranged between 0.94% - 3.13% p.a. 

There was no transaction in USD for demand loans; the amount of transactions in USD for 12 month term was small.

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

4. Exchange rate   

In response to the SBV adjustment of the inter-bank average exchange rate and trading band, commercial banks, enterprises and the public highly valued this action and recognized this policy change as a decisive measure to improve the liquidity of the forex market, hence contributing to limiting operational risks of enterprises and credit institutions, and enhancing the flexibility of the market.

The VND/USD rates were commonly quoted by commercial banks at 20,780-20,880.

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