Responding to VTC News on the sidelines of the National Assembly, delegate Vu Tien Loc (Hanoi) highly appreciated the State Bank of Vietnam (SBV)'s direction for credit institutions to thoroughly cut costs to reduce lending interest rates to support businesses, people and the economy to recover production and business.
According to Mr. Loc, the SBV's continued reduction of operating interest rates is a flexible solution, suitable to current market conditions, to achieve the goal of reducing lending interest rates to support the economic growth recovery process according to the policy of the National Assembly and the direction of the Government and the Prime Minister; thereby, the SBV continues to orientate the reduction of market lending interest rates, contributing to removing difficulties for businesses, people and the economy.
Delegate Vu Tien Loc answers the press in the hallway of the National Assembly.
“The continued reduction of the operating interest rate by the State Bank affirms and establishes the trend of interest rate reduction for the market in the coming time, thereby orienting credit institutions to be more bold and drastic in reducing lending interest rates, accompanying businesses and people, contributing to promoting economic growth and recovery,” said delegate Vu Tien Loc.
However, Mr. Loc also said that in the current credit sector, in addition to reducing interest rates, the speed of disbursement time of banks, helping businesses access capital is also a very important factor, proving that the policy is effectively implemented, actively supporting people and businesses. This has a decisive meaning for the business activities of enterprises.
“If the loan disbursement process is prolonged, it could kill the business. On the contrary, if the implementation is quick and the time is shortened, it will help businesses access capital more easily and can recover production and business faster,” said Mr. Loc.
Meanwhile, economic expert, Dr. Nguyen Minh Phong, said that whether a business wants to access loans quickly or slowly depends on the ability and financial situation of each business in ensuring the necessary requirements of each bank. Businesses want to access loans as quickly as possible, which is a very legitimate desire, but the bank cannot make a breakthrough and must be within the regulations on credit safety.
Therefore, according to Mr. Phong, the most important issue for banks is to lower interest rates, and the most important issue for businesses is to find every way to meet the banks' requirements.
“The most important thing is to reduce lending interest rates, because in reality, up to this point, banks have mainly reduced deposit interest rates, but lending interest rates have not decreased much or have not decreased in proportion to the reduction in deposit interest rates,” said Mr. Phong.
Many banks have reduced deposit interest rates. (Illustration photo: Vietnam+).
On June 16, the State Bank announced the fourth reduction in operating interest rates since the beginning of the year, effective from June 19. Accordingly, the overnight lending interest rate in interbank electronic payments and lending to cover capital shortages in the State Bank's clearing payments for credit institutions will decrease from 5.5%/year to 5%/year; the refinancing interest rate will decrease from 5%/year to 4.5%/year; the rediscount interest rate will decrease from 3.5%/year to 3%/year.
The maximum interest rate applied to demand deposits and deposits with terms of less than 1 month remains at 0.5%/year; the maximum interest rate applied to deposits with terms from 1 month to less than 6 months decreases from 5%/year to 4.75%/year.
The maximum interest rate for deposits in VND at People's Credit Funds and Microfinance Institutions is reduced from 5.5%/year to 5.25%/year; the interest rate for deposits with terms of 6 months or more is determined by credit institutions based on market supply and demand of capital.
The maximum short-term lending interest rate in VND of credit institutions for borrowers to meet capital needs for a number of economic sectors and industries is reduced from 4.5%/year to 4.0%/year; the maximum short-term lending interest rate in VND of People's Credit Funds and Microfinance Institutions for these capital needs is reduced from 5.5%/year to 5%/year.
This is the fourth time since the beginning of 2023 that the State Bank has reduced operating interest rates. The previous three times, interest rates were reduced by 0.5-1.5%/year in March, April and May 2023.
After this regulation of the State Bank, starting from June 19, banks simultaneously adjusted to reduce deposit interest rates.
Specifically: PVCombank sharply reduced 0.5 percentage points for terms of 6 months or more. Currently, the online mobilization interest rate of this bank is only 7%/year for 6-month term deposits; 7.3%/year for 7-8 month term; 7.4%/year for 9-10 month term; 7.5%/year for 11-month term; 7.7%/year for 12-month term; and 7.8%/year for terms over 12 months.
NamA Bank reduced interest rates by 0.1 to 0.3 percentage points for terms of 6 months or more. Online deposit interest rates for terms of 6 months and 9 months decreased to 7.6%/year. Deposit interest rates for terms of 12-14 months decreased slightly by 0.1 percentage points to 7.7%/year. A similar reduction also brought deposit interest rates for terms of 15 months or more to 7.5%/year.
"The big guy" Vietcombank also reduced the interest rate for 1-2 month term deposits from 4.5% to only 3.6%/year; 3-5 month term deposits from 5% to 4.3%/year; 6-11 month term deposits decreased to 5.2%/year compared to 6%/year last week. Terms of 12 months or more also decreased sharply from 6.8% to 6.3%/year.
Agribank reduced interest rates for 1-2 month terms from 4.7% to 4.3%/year; for 3-5 month terms from 4.9%/year to 4.5%/year. At the same time, this bank further reduced interest rates for long terms for the first time this month. For 6-9 month terms, the rate decreased from 6% to 5.7%/year; for 12 month terms or more, the rate decreased from 6.8%/year to 6.3%/year.
Meanwhile, some banks have reduced interest rates 2 or 3 times since the beginning of the month. HDBank has announced a third reduction in deposit interest rates, with a reduction of 0.2 percentage points for deposits with terms of 6 months or more. According to the online deposit interest rate table, the interest rate for a 6-month term is 7.5%/year; for a 7-11-month term is only 6.9%/year; for a 12-13-month term is 7.5%/year. Meanwhile, the 18-month term remains at 7.1%/year.
BaoViet Bank also reduced interest rates for the second time this month. The specific reduction is up to 0.5 percentage points for online deposit terms. Interest rates for 6-month terms are now 7%/year; for 7-11-month terms are now 7.1%/year after a 0.5 percentage point reduction. Interest rates for 12-month terms are down 0.2 percentage points to 7.7%/year; for 13-month terms are now 7.9%/year (the highest rate); for 15-18-month terms, the interest rate remains at 7.6%/year.
OCB Bank reduced interest rates for the second time with a sharp decrease of 0.5 percentage points, remaining at 7.3% and 7.4%/year for 6-month and 9-month terms. 12-15-month terms decreased by 0.3 percentage points to 7.6%/year. Terms of 18 months or more were reduced by 0.2 percentage points to 7.4%/year.
VietA Bank has reduced interest rates for the second time by 0.2 percentage points for terms of 6 months or more. The interest rate for terms of 6-11 months at this bank is now 7.4%/year, and for terms of 12-18 months is now 7.6%/year.
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