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Banks begin reducing deposit interest rates in response to PM’s directive
Several commercial banks have started reducing deposit interest rates by 0.1 to 0.4 percentage points in response to the Prime Minister’s directive to lower rates to help achieve the Government’s 8 per cent growth target in 2025.
A bank employee counts money for a customer at a private branch in HCM City. Several banks have begun lowering deposit interest rates following a directive from the Prime Minister. — VNS Photo Bồ Xuân Hiệp
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VietBank has cut rates by 0.1 to 0.4 percentage points, while BVBank has lowered rates by 0.1 to 0.3 percentage points.
The Maritime Bank of Vietnam (MSB) and Eximbank have both reduced rates by 0.2 percentage points for specific terms.
Although these reductions are modest, they contrast with the recent upward trend in rates.
As of February 26, only three banks – GPBank, CBBank, and Woori Bank – offer rates of 6 per cent or higher for certain deposits.
The State Bank of Vietnam (SBV) aims for stable lending rates to support the economy, while private banks compete to raise deposit rates to attract deposits.
The SBV is committed to monitoring the market and ensuring transparency in lending rates.
It will take strict action against banks that violate regulations, especially those that have recently increased deposit rates, as part of efforts to maintain economic stability.
Prime Minister Phạm Minh Chính has emphasised the importance of lowering lending rates to support economic growth, urging banks to reduce operating costs and prioritise credit for productive sectors.
Deposit rates reached a peak of over 12 per cent per annum at the end of 2022, following the collapse of a private bank, in which the SBV had intervened in order to safeguard the system’s safety.
As a result, deposit interest rates began to decline in March 2023, ultimately reaching a historic low of around 4 per cent per annum for both state-owned and private banks.
However, there has been a recent resurgence in the rates, with the current averages standing at 5 per cent for state-owned banks and over 6 per cent for private banks.
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