Banks raise interest rates on deposits based on demand for funds and inflation

VIETNAM, May 18 –

A customer makes a deposit in a bank in Bình Dương province.

HCM CITY – Many banks raised interest rates on deposits by 0.1 to 0.6 percentage points amid growing demand for funds.

Last year, the average interest rates on six-month and 12-month bank deposits were 4.7% and 5.5%, down half a percentage point from 2020, said Bảo Việt Securities.

The State Bank of Việt Nam said that in 2021 rates were at their lowest level in five years.

But rates, especially at small and medium banks, have risen sharply since the start of this month.

Currently, peak rates are 6.5 to 7.4%.

NamABank offers the highest rate for online savings, even for small amounts. Customers who deposit money through its online banking app for 16-36 months can earn 7.4% interest. For 12 months, it is 6.4%.

The Sài Gòn – Hà Nội Commercial Joint Stock Bank (SHB) raised its rates by 0.2 to 0.4 percentage points. For 36 months, the rate is 0.4 percentage points up to 6.5-6.6%. For 12-month terms, it went from 5.7-5.8% to 6.1-6.2%.

Bản Việt Bank (Viet Capital Bank) has raised its rates to a maximum of 7% for 24 months if deposited online and 6.8% if deposited at the counter.

Eximbank, VPBank, Techcombank, OCB, SCB, LienVietPostBank, HDBank and ACB have also increased their rates.

According to data from the State Bank of Vietnam, deposits increased by 1.38% to nearly VNĐ 11.2 quadrillion in the first two months of 2022, with individual customers accounting for VNĐ 5.46 quadrillion and client companies 5.63 quadrillion VNĐ..

Last year, retail deposits declined as many retreated to invest in more attractive asset classes amid low deposit interest rates.

Experts said the increase in interest rates on deposits comes at a time when demand for credit is increasing significantly.

Outstanding loans were 5.04% at the end of March compared to a year earlier, as demand for capital increased to serve production and business after a long period of stagnation due to the COVID-19 pandemic.

VNDirect Securities Company said inflationary pressure and fierce competition from other asset classes such as real estate and securities would drive up interest rates on deposits.

This year, he expects deposit interest rates to rise by 0.3 to 0.5 percentage points to 5.9 to 6.1 percent. –VNS

Comments are closed.