Banks continue to cut deposit interest rates

With the Covid-19 pandemic acting as a drag on credit growth, banks are continuing to cut deposit interest rates.

State-owned lenders BIDV, Agribank and VietinBank this week reduced their 12-month rates by 0.2 percentage points to 5.6 percent.

The other “Big 4” state-owned lender, Vietcombank, kept its 12-month rate unchanged at 5.8 percent but cut the 24-month and 36-month rates by 0.2 percentage points to 5.7 percent and 5.4 percent.

The largest private lender, Techcombank, reduced its 12-month rate by 0.4 percentage points to 4.5-5 percent depending on the deposit amount.

The rates have thus dropped by 0.4 percentage points within two months.

Banks have reported high liquidity but difficulty lending as the pandemic hits businesses.

Banking credit growth in the first nine months of this year was just 5.12 percent, far below the double-digit figures recorded of the last three years, according to the General Statistics Office.

In August the State Bank of Vietnam revised its credit growth target for this year from 14 to 10.1 percent. It has also cut its policy rates four times so far this year to pump-prime the economy.