People's deposits in banks set a record

By the end of July, the amount of people's deposits in the banking system reached an all-time high of nearly VND6.39 trillion, an increase of nearly 9% compared to the end of last year.

This is the latest data just announced by the State Bank. Accordingly, in July, people deposited about 6,700 billion VND more into the banking system. This increase is lower than the average increase in the first period of the year, partly due to seasonality. In previous years, the growth rate of people's deposits in July also tended to be slower than in the first months of the year.

Transaction at a commercial bank. Photo: Thanh Tung — Transaction at a commercial bank. Photo: *Thanh Tung*

Savings interest rates as of the end of July have dropped significantly compared to the beginning of the year, but many banks are still willing to pay interest rates above 7% per year for 12-month deposits. The interest rate decline over the past two months has caused interest rates in October to hit rock bottom, with some terms lower than during the Covid-19 period.

The low interest rate environment during the Covid-19 period caused cash flow to shift strongly to investment channels such as stocks, real estate, etc. However, according to bank leaders, this trend will not repeat itself at the present time. Consumption and production activities are no longer interrupted by Covid-19, the real estate market is also gloomy after a series of adjustments, making cash flow seeking profits more cautious.

In contrast to individuals , the institutional sector "net withdrew" about 74,200 billion VND from the system, causing the amount of deposits of this group at banks to decrease compared to the previous month and lower than at the beginning of this year. Specifically, the business and union sector... deposited 5.91 million billion VND at banks at the end of July, 0.74% lower than at the end of last year.

Quynh Trang

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