On October 20, Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank – HoSE: VCB) announced a new deposit interest rate schedule effective from today. Accordingly, the bank continued to reduce interest rates by 0.2 percentage points for many terms, down to a historic low.
Specifically, for the 1-2 month term, Vietcombank reduced the interest rate from 3%/year to 2.8%/year. For the 3-5 month term, this bank also reduced the interest rate by 0.2 percentage points to 3.1%/year. The interest rate for the 6-9 month term also decreased by 0.2% to 4.1%/year.
For terms of 12 months or more, the bank applies a common rate of 5.1%/year, down 0.2 percentage points compared to before. This is the lowest rate in the history of this bank's operations, even lower than the Covid-19 period. Previously, Vietcombank listed the 12-month term interest rate 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, this bank reduced deposit interest rates by 0.3 percentage points on September 14, then continued to reduce them by another 0.2 percentage points from October 3. Considering the total reduction in deposit interest rates in the past month, the interest 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 2.3%/year in less than 1 year.
Looking back at the end of 2022, savings interest rates were up to 11-12%/year in the context of many banks racing to mobilize capital, and by 2023, interest rates were still quite high.
However, since the second quarter of 2023, after the State Bank of Vietnam (SBV) drastically reduced operating interest rates to implement the National Assembly's resolution, the Government's and Prime Minister's direction to support people and businesses to increase access to capital and contribute to the recovery of production and business activities, up to now, the mobilization interest rate level has cooled down.
At the meeting of the Government Standing Committee on October 11, Deputy Governor of the State Bank of Vietnam Dao Minh Tu said that since the beginning of the year, the State Bank of Vietnam has been operating monetary policy in a gradual loosening trend in accordance with the requirements of controlling inflation and stabilizing the macro economy by adjusting the operating interest rates down by 0.5-2%/year to orient and create conditions for credit institutions to reduce lending interest rates, contributing to increasing social investment, supporting production, economic growth and job creation.
Up to now, VND lending interest rates have decreased by an average of about 1.5 - 2.0%/year compared to the end of 2022 and are expected to continue to decrease in the coming time due to the impact of policy lag after the SBV's adjustments to operating interest rates. From the beginning of the year, it was only expected to decrease by 1.5%, but so far in October, it has decreased by 1.5% - 2%, and will continue to decrease until the end of the year.
"With the drastic implementation and efforts of the State Bank and the banking industry, by September 29, 2023, outstanding credit balance of the whole economy had increased by nearly 7% (in the same period in 2022, it increased by 11.05%), in September alone, in the first days of October, the positive growth rate reached about 1%.
The total outstanding debt of the entire economy to date is about 13 million billion VND, 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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