Many commercial banks lower their annual deposit interest rate to less than 13% right after the State Bank of Vietnam (SBV) cuts ceiling deposit interest rate for VND accounts to 13%.
Deposit interest rate forecast to decline
Ocean Commercial Joint Stock Bank (Ocean Bank) announced that their new annual deposit interest rate for 1 to 12 month term will be adjusted to 13%. The rate for terms longer than 12 months will be between 12% and 12.8% per year.
Tien Phong Commercial Joint Stock Bank was also quick to adjust their interest rates to 13% per year for terms of more than one month. The capped rates for non-term or weekly deposits is 5%.
Vietnam Technological and Commercial Joint Stock Bank (Techcombank) has the lowest annual interest rate for deposits with terms of over a month at 12.94%, while their interest rate for terms of less than one month is 5%.
Meanwhile Vietnam Commercial Joint Stock Bank of Industry and Trade (VietinBank) cut its interest rate for deposit with term of less than 12 months to 13%, and have applied an annual rate of 9-10% for term longer than 12 months.
Asia Commercial Joint Stock Bank (ACB)’s have also taken on the new 13% per year interest rate, and changed rates for non-terms to less than 5%.
Nguyen Viet Anh, Deputy General Director of Tien Phong Bank said the liquidity of the bank is at a healthy level. “While applying a new interest rate in accordance with SBV’s instructions, we are also adding new customer services," he said.
Addressing the SBV's decision to cut deposit interest rates, Nguyen Thi Mai Huong, Deputy CEO of Ocean Bank, said, “I think the new rate is appropriate for the country's economic situation, and in line with the Government's goals concerning inflation. Now banks are playing on a level playing field that encourages competition and improving service quality. A focus on service will determine a bank's success in the future.”
It has been common in Vietnam for customers to split their money into accounts at several different banks to earn more interest. Many believe that the new interest rates will prompt them to gather their funds into single accounts.
Experts have also said that the change will also encourage customers to change to long-term deposits, as interest rates are expected to go down in the future.
