Average interest rates on new loans in late October fell approximately 0.2–0.5 percentage points from mid-month, State Bank of Vietnam Deputy Governor Pham Thanh Ha said at a November 4 government briefing. The Government Electronic Newspaper also reported lower deposit rates and measures to support banks’ funding.
Observed changes and preferential programmes
Ha said listed rates for deposits of at least six months had declined. Typical reductions were 0.5 percentage points at state-owned commercial banks and wholly foreign-owned banks, and 0.5–0.7 points at joint-stock commercial banks.
Average rates on newly placed deposits were approximately 0.4 points lower in late October than in the middle of the month. The reported 0.2–0.5-point lending decline used the same comparison period and covered new loans.
More than 20 banks had announced preferential credit programmes for production, business and priority sectors, with reductions of 1.5–2 percentage points. The central bank had instructed lenders to cut expenses and share profits to help lower funding costs.
Liquidity support and implementation
The central bank is combining open-market operations, refinancing and foreign-currency–dong swaps. On November 3 it announced six-month swaps intended to provide banks with longer-term dong funding.
Ha said policy would continue to follow domestic and international conditions, support liquidity and direct credit toward production and priority activities while managing risks. Digitalisation of lending procedures also features in the instructions.
The Government Office minister called for continued monitoring and follow-up with commercial banks so that rate reductions are implemented effectively. That supervision accompanies the initial changes reported at the briefing.