Banks lower savings rates but base rate could still be high
Several local banks have reduced their interest rates in recent days, going against the banking sector’s general year-end trend of increasing rates to boost earnings.
Illustrative image (Photo: VNA) Hanoi (VNS/VNA) - Several local banks
have reduced their interest rates in recent days, going against the banking
sector’s general year-end trend of increasing rates to boost earnings.
On November 11, Saigon Commercial Bank (SCB) cut its 24-month savings rate by 0.2 percentage point to 7.55 percent per annum.
Ban Viet Bank (VietCapitalBank) in early November curbed savings rates by 0.1-0.2 percentage point for accounts with terms of less than 12 months and more than 24 months. But the bank raised rates for 15-month accounts by 0.2 percentage point to 8.5 percent per annum.
At Eximbank, savings rates for 15-month and 18-month accounts were also cut by 0.2 percentage point to 8.1 percent per annum.
Savings rates were reduced by 0.1-0.2 percentage points by ABBank, Saigon-Hanoi Bank (SHB), VPBank and Techcombank.
The banks’ third-quarter financial reports showed they had all recorded increases in customer savings as of the end of September.
In contrast, other banks have raised savings rates by 0.2-0.7 percentage points for less-than-12-month accounts, such as National Citizen Bank (NCB) and Vietnam Public Bank (PVcomBank).
Central banks in Southeast Asia and East Asia such as Thailand, China, the Republic of Korea, India, Indonesia and the Philippines have cut their base interest rates to stimulate the economy and raise inflation.
The State Bank of Vietnam (SBV) last week pumped a net value of 6 trillion VND (258.6 million USD) into the banking sector to help reduce interest rates.
At the ongoing 14th National Assembly’s eighth meeting, Prime Minister Nguyen Xuan Phuc urged banks to cut lending rates by a minimum of 0.5 percent for prioritised industries in 2020 to boost their performances.
SSI Securities Corporation's (SSI) research unit (SSI Research) said in a recent report there was barely a change in both saving and lending interest rates in the last two months of the year.
The range of interest rates had not changed much though banks had lowered their rates by 10-20 basis points and there was still a gap between small-cap and large-cap banks, SSI Research said.
Interest rates of 4.1-5.5 percent per annum for savings with terms of less than six months, 5.3-7.8 percent for savings with terms of 6-12 months and 6.4-8.1 percent for savings with terms of 12 and 13 months.
According to SHB General Director Nguyen Van Le, banks were raising long-term capital from customers to boost their performances in the final months of the year.
According to the Bank for Investment and Development of Vietnam (BIDV)’s Institute for Training and Research, interest rates had increased by on average 0.4 percent in the first 10 months.
Banks wanted to increase capital to meet the demands for borrowing at the year-end, meet Basel 2 standards on capital adequacy ratio (CAR), and match the SBV’s policy to reduce the use of short-term capital to pay medium- and long-term loans.
Banks were having difficulties because the credit limit was set at 14 percent for 2019 so some banks, which had almost crossed the bar, had to consider lowering saving rates to save costs, according to business insiders./.
On November 11, Saigon Commercial Bank (SCB) cut its 24-month savings rate by 0.2 percentage point to 7.55 percent per annum.
Ban Viet Bank (VietCapitalBank) in early November curbed savings rates by 0.1-0.2 percentage point for accounts with terms of less than 12 months and more than 24 months. But the bank raised rates for 15-month accounts by 0.2 percentage point to 8.5 percent per annum.
At Eximbank, savings rates for 15-month and 18-month accounts were also cut by 0.2 percentage point to 8.1 percent per annum.
Savings rates were reduced by 0.1-0.2 percentage points by ABBank, Saigon-Hanoi Bank (SHB), VPBank and Techcombank.
The banks’ third-quarter financial reports showed they had all recorded increases in customer savings as of the end of September.
In contrast, other banks have raised savings rates by 0.2-0.7 percentage points for less-than-12-month accounts, such as National Citizen Bank (NCB) and Vietnam Public Bank (PVcomBank).
Central banks in Southeast Asia and East Asia such as Thailand, China, the Republic of Korea, India, Indonesia and the Philippines have cut their base interest rates to stimulate the economy and raise inflation.
The State Bank of Vietnam (SBV) last week pumped a net value of 6 trillion VND (258.6 million USD) into the banking sector to help reduce interest rates.
At the ongoing 14th National Assembly’s eighth meeting, Prime Minister Nguyen Xuan Phuc urged banks to cut lending rates by a minimum of 0.5 percent for prioritised industries in 2020 to boost their performances.
SSI Securities Corporation's (SSI) research unit (SSI Research) said in a recent report there was barely a change in both saving and lending interest rates in the last two months of the year.
The range of interest rates had not changed much though banks had lowered their rates by 10-20 basis points and there was still a gap between small-cap and large-cap banks, SSI Research said.
Interest rates of 4.1-5.5 percent per annum for savings with terms of less than six months, 5.3-7.8 percent for savings with terms of 6-12 months and 6.4-8.1 percent for savings with terms of 12 and 13 months.
According to SHB General Director Nguyen Van Le, banks were raising long-term capital from customers to boost their performances in the final months of the year.
According to the Bank for Investment and Development of Vietnam (BIDV)’s Institute for Training and Research, interest rates had increased by on average 0.4 percent in the first 10 months.
Banks wanted to increase capital to meet the demands for borrowing at the year-end, meet Basel 2 standards on capital adequacy ratio (CAR), and match the SBV’s policy to reduce the use of short-term capital to pay medium- and long-term loans.
Banks were having difficulties because the credit limit was set at 14 percent for 2019 so some banks, which had almost crossed the bar, had to consider lowering saving rates to save costs, according to business insiders./.
You should also see
PM visits police command centre, checks cultural centre construction in Phu Tho
Prime Minister Pham Minh Chinh visited the command and control centre of the Phu Tho police and examined the construction of this northern province’s house of culture and arts on April 18.
See more
Business
Vietjet adds more flights to Dien Bien
To meet the rising demands to visit Dien Bien of people and tourists during the celebration of the 70th anniversary of the Dien Bien Phu victory, Vietjet increased the frequencies of flights between Hanoi, Ho Chi Minh City and the northwestern province to 28 per week.
Videos
Agro-forestry-fisheries products nearly double in Q1
Total export revenue from agro-forestry-fisheries products in the first three months of this year is estimated at over 13.5 billion USD, up nearly 22% over the same period last year, according to the Ministry of Agriculture and Rural Development.
Business
Beautycare Expo 2024 opens in Hanoi
The Beautycare Expo 2024 kicked off Hanoi on April 18, featuring over 250 booths from more than 15 countries and territories.
Business
Standard Chartered, US promote clean energy investments in Vietnam
Standard Chartered and the US Agency for International Development (USAID) have signed a Memorandum of Understanding (MoU) on green financing in Vietnam and to promote the deployment of advanced clean energy in Vietnam.
Business
Vietnam Airlines, Sun Group promote Vietnam’s tourism in RoK
National flag carrier Vietnam Airlines and Sun Group on April 17 held a tourism promotion event themed “The Magnificent Vietnam” in Seoul, aiming to promote Vietnam’s tourism potential, flights, and trade opportunities for Vietnam and the Republic of Korea (RoK).
