Some major banks have cut their dong deposit interest rates but said they are not ready to reduce lending rates yet.
An unnamed Vietnam Commercial Joint Stock Bank for Foreign Trade (Vietcombank) official was quoted by news website thoibaokinhtesaigon as saying that the recent cuts in rates are only for short-term deposits of one month to two months and aimed at studying the market, and should not be taken as a sign of general rate cuts.
It would take some time for the reduction to have an impact on liquidity, and banks cannot lower lending rates in the meantime, the executive said.
On July 11 Vietcombank unexpectedly lowered its rate for one-month deposits from 6 percent to 5 percent. The State Bank of Vietnam's cap for one to six months is 7 percent.
The Vietnam Bank for Agriculture & Rural Development, or Agribank, also lowered the rate to 5 percent the same day.
Soon the Bank for Investment and Development of Vietnam followed.
The Vietnam Commercial Joint Stock Bank for Industry and Trade (VietinBank) reduced the rate to 6 percent from 6.5 percent.
Phan Huy Khang, CEO of the Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank), said his bank does not plan to reduce its rate for one month from 7 percent, and therefore its lending rates would see no change at the moment.
In a recent report the central bank said the average lending interest rates at state-owned banks stand at 7-9 percent for agriculture, exports, supporting industry, small and medium-sized enterprises, and businesses using high technology.
For others, the rates are 9-10.5 percent for short-term loans and 11.5-12.8 percent for others.
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