On October 20th, Vietcombank (HoSe: VCB) announced its new deposit interest rate schedule, effective from today. Accordingly, the bank continued to reduce interest rates by up to 0.2 percentage points across many maturities, reaching historically low levels.
Specifically, for terms of 1-2 months, Vietcombank lowered interest rates from 3%/year to 2.8%/year. For terms of 3-5 months, the bank also reduced rates by 0.2 percentage points to 3.1%/year. Interest rates for terms of 6-9 months also decreased by 0.2% to 4.1%/year.
For terms of 12 months or more, the bank applies a uniform rate of 5.1%/year, a decrease of 0.2 percentage points compared to before. This is the lowest rate in the bank's history, even lower than during the Covid-19 period. Previously, Vietcombank had listed the interest rate for a 12-month term at 5.5%/year throughout the period from July 2021 to July 2022.
Thus, in the past month, Vietcombank has reduced interest rates three times in a row. Specifically, the bank reduced deposit interest rates by 0.3 percentage points on September 14th, and then further reduced them by 0.2 percentage points from October 3rd. Considering the total reduction in deposit interest rates over the past month, the rate has cooled down by 0.7 percentage points.
Compared to the highest interest rate set at the end of last year at 7.4%/year, Vietcombank has reduced it by as much as 2.3%/year in less than a year.
Looking back at the end of 2022, savings interest rates reached 11-12% per year as many banks competed to attract deposits, and interest rates remained quite high in 2023.
However, since the second quarter of 2023, after the State Bank of Vietnam (SBV) aggressively reduced the policy interest rate to implement the National Assembly 's resolution, the Government's and Prime Minister's directives to support people and businesses in increasing access to capital and contributing to the recovery of production and business activities, the deposit interest rate has cooled down.
At the Government Standing Committee meeting on October 11th, Deputy Governor of the State Bank of Vietnam, Dao Minh Tu, stated that since the beginning of the year, the State Bank of Vietnam has been managing monetary policy in a gradually easing manner, consistent with the requirements of controlling inflation and stabilizing the macroeconomy. This has been achieved by adjusting down policy interest rates by 0.5-2% per year to guide and facilitate credit institutions in reducing lending interest rates, contributing to increased social investment, supporting production, economic growth, and job creation.
To date, VND lending interest rates have decreased by an average of about 1.5-2.0% per year compared to the end of 2022 and are expected to continue to fall in the near future due to the policy lag following the State Bank of Vietnam's adjustments to reduce the policy interest rate. Initially, a reduction of only 1.5% was expected at the beginning of the year, but by October alone, it has already decreased by 1.5%-2%, and further reductions are expected until the end of the year.
"Thanks to the decisive implementation and efforts of the State Bank of Vietnam and the banking sector, by September 29, 2023, outstanding credit in the entire economy had increased by nearly 7% (compared to an 11.05% increase in the same period of 2022), with a positive growth rate of approximately 1% in September and the beginning of October."
"The total outstanding debt of the entire economy to date is approximately 13 million billion VND, and since the beginning of the year, nearly 600,000 billion VND has been provided to businesses to support the struggling bond market," Mr. Dao Minh Tu informed .
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