Vietnamese banks cut deposit rate to reduce costs for economy

HANOI, March 6 (Xinhua): A string of Vietnamese banks lowered their deposit interest rates on Monday, signaling possible lending rate cuts to support businesses and shore up economic growth, Vietnam News Agency reported, citing the State Bank of Vietnam (SBV).

Four biggest banks, including state-owned Agribank and three partly privatized lender Vietcombank, BIDV, and Vietinbank, on Monday cut deposit rates by 0.2 percentage points on Vietnamese dong deposits with maturities ranging from 6 months to one year.

Vietcombank cut the interest rate for 6-month and 9-month deposits to 5.8 per cent, one-year to 7.4 per cent, and five-year deposits to 7.2 per cent, according to a statement on its website.

Smaller lenders, following in the footsteps of their major peers, have implemented rate cuts by 0.5 percentage points on 6-month and one-year deposits, after the central bank urged banks to cut loan rates to help struggling businesses, according to the media.

Commercial banks have paid an average 8 per cent for deposits since the last quarter of last year after the central bank raised policy interest rates in October to contain inflation.

Vietnam's economy grew 8.02 per cent in 2022, faster than the 2.6 per cent growth of 2021, mainly backed by domestic retail sales and export recovery. Consumer prices rose 3.15 per cent last year from a year earlier.

The Southeast Asian country targets GDP growth of 6.5 per cent and inflation at 4.5 per cent for this year.

The country's banking system arranged 11.9 quadrillion Vietnamese dong (US$500 billion) in Vietnamese dong loans in 2022, up 14.8 percent on the year, according to data from the SBV. - Xinhua

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Vietnam , Banks , Economy


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