The State Bank of Vietnam officially recognized the rate cap on dong deposits that had been established by local banks.
All banks are required to publicly announce their deposit rates and are not allowed to offer perks or cash bonuses that would raise rates above 14 percent, the central bank said.
Banks found in violation of the rate cap will be punished, it said.
This is the first time the central bank issued a circular officially recognizing the rate cap established by members of the Vietnam Banks Association last December.
Duong Thu Huong, general secretary of the association, was quoted by news website VnExpress as saying that several banks had breached the industry cap. Some banks now offer 16-17 percent interest on dong deposits.