Want to be in the loop?
subscribe to
our notification
Business News
BANKS REQUIRED TO CUT RATES TO SUPPORT ECONOMIC RECOVERY
Nguyễn Thị Hồng, the Governor of the State Bank of Vietnam (SBV), has directed banks to continually reduce input costs with an aim to cut loan interest rates.
Under a document issued on Thursday, banks have been required to cut operating costs and unnecessary expenses, as well as administrative procedures, so as to have room for lending interest rate reduction to support the economic recovery and development.
Banks have been also instructed to continually promote the implementation of the Government’s interest rate support programme for loans of enterprises, cooperatives and business households according to the Government's Decree 31/2022/NĐ-CP dated May 20, 2022.
“The SBV will monitor banks, which continue to raise interest rates, and take measures to deal with the violation cases,” the Governor noted.
At a recent meeting, the Vietnam Bankers Association (VNBA) called on its members to keep deposit interest rates at 9.5 per cent or below to reduce lending interests and boost economic recovery. The move was made after many banks raised their rates to up to 11.5 per cent per year for a 12-month term.
According to VNBA’s chairman Nguyễn Quốc Hùng, the rise created intense competition in mobilising money, which caused instability among depositors and borrowers.
Rising deposit interest rates means rising costs, which makes it more difficult to lower loan interest rates to support businesses, Hùng said.
Bank representatives at the meeting agreed with the proposal to keep deposit interest rates at 9.5 per cent maximum.
Some banks have started to lower their deposit interest rates. It has been reported that the interest rate race has stalled, with no banks increasing their rates over the past week after a flurry of activity in the past few months.
According to experts, in order to make banks feel secure in agreeing to lower deposit interest rates, the SBV has made efforts to support liquidity for banks through the open market operation (OMO) channel.
Under the newly issued document, the SBV also directs banks to give loan priority to agriculture, export, small- and medium-sized enterprises, supporting industries, high-tech enterprises, industrial park construction and solvent real estate projects for low income people.
Banks must strictly control credit risks for investment activities in corporate bonds, securities and real estate sectors, according to the document.
Source: VNS
Related News
DIGITAL TRANSFORMATION IN LOGISTICS – A KEY TO UNLOCKING SUSTAINABLE E-COMMERCE AND ECONOMIC DEVELOPMENT
Accelerating digital transformation in logistics is critical in order to promote the sustainable development of e-commerce, a conference on applying technology held by the Ministry of Industry and Trade heard on Thursday, as well as accelerating overall economic growth.
SOILBUILD EXTENDS ITS HORIZONS INTO VIETNAM INDUSTRIAL REAL ESTATE
Soilbuild Group, an integrated real estate group, has broadened its investment in industrial real estate to Vietnam through its Soilbuild International division. The official launch of Soilbuild International (Vietnam) took place in Hanoi on May 9th, 2024, and was attended by esteemed guests, including domestic and international partners.
SEMINAR: BUSINESS SPOTLIGHT - THE HONG KONG-INSPIRED PRESENCE NESTLED IN THE HEART OF HANOI'S EAST
16h00 - 18h00, Wednesday (May 22nd, 2024)Almaz Convention Center - Hanoi (GG map: https://maps.app.goo.gl/YtWyGgkiTwWvFnfX6)
VIETNAM SECURES REMARKABLE ECONOMIC SUCCESSES SINCE NATIONAL REUNIFICATION
Since the national reunification on April 30, 1975, Vietnam has obtained admirable economic achievements and is now on its way to become the 20th largest economy in the world. Back to 1975, Vietnam, torn by two major wars, was a backward economy dependent on agriculture and foreign assistance. Foreign loans and aid accounted for over 63 percent of its budget.
350 EXHIBITORS TO TAKE PART IN HCM CITY PAPER, COATINGS, RUBBER, PLASTIC EXPOS
They will have a total display area of 10,000sq.m, 30 per cent more than last year, and the participation of over 350 local and international exhibitors who will showcase thousands of products and technologies.
INT’L INVESTORS EYE VIETNAM’S DATA CENTER MARKET – REPORT
Vietnam’s data center market is increasingly attractive to foreign investors, driven by the country’s expanding digital economy, rising data consumption, and supportive government policies, said a new report by JLL. While Vietnam’s data center sector has traditionally been dominated by local telecommunications companies, global players are now entering the market.