After the State Bank of Vietnam issued a circular No.19 on adjusting some regulations of the Circular No.13 to facilitate credit organizations’ capital approach, some commercial banks quickly decrease deposit interest rates in VND and launch many programs to lure customers. However, the roadmap of decreasing lending interest rates is still under expectation.
Many businesses need capital sources in the year-end.
Boosting lending measures
Before Circular 19 took effect on Oct. 1, some credit organizations showed positive deeds. On Sept. 30, DaiABank cut its deposit interest rate from 0.14 percent per annum to 0.2 percent per annum.
As for lending interest rate, NamABank, said the bank will spend VND1tril for preferential loans from now till the end of Oct. Meanwhile, Sacombank launches the Export Credit Guarantee Program, or GSM-102. The program will help local farm produce importers gain access to capital sources with preferential terms and interest rates. Phuong Tay Bank slashes 1% of lending interest rates for small businesses and 30% of money transfer fee in the first 3 months and so on.
In addition, many other banks of OCB, ACB, Sacombank… also boost consumption lending programs with attractive interest rates so as to encourage individual customers in the year-end.
Awaiting interest rate decrease
The interest rates may be eased after the amendment of Circular 13, but the interest rate decreases will not be sharp. However, based on the adjusted regulation, commercial banks will enjoy an amount of money to balance for their lending sources. A staff of Dong A Bank, said the adjustment will create transparency in capital mobilization.
Cutting of lending interest rates in some banks is a good signal. A staff of Dong A Bank, said the roadmap of interest rate decrease needs more time but the ratio of cutting interest rates depends on market supply and demand and condition of every bank. He added, deposit and lending interest rates will not change much because many banks are in thirst of capital sources.
Vietcombank’s Binh Duong branch said that the bank has applied an interest rate of 13.5% per annum – 14.8% per annum. However, to keep clients, the branch has applied a preferential policy with a slight decrease in interest rate for traditional clients. The interest rates still cannot be eased to the desired levels (10 percent for deposit interest rate, and 12 percent for lending interest rate), because the inflation rate tends to increase, while banks are still facing difficulties in mobilizing capital. Besides, commercial banks set interest rates based on the inflation rates. Meanwhile, the inflation rate tends to increase in the last months of the year.
These factors make banks mull over adjustment of interest rates, despite the Vietnam Banking Association’s commitments of plans of cutting lending interest rates on Oct. 15 ahead.
Reported by T.Huynh – Translated by A.C
