After the State Bank of Vietnam (SBV)’s decision to raise the operating interest rate, analysts believe that the net interest margin (NIM) in the industry will narrow but the impact will differ. Banks with high CASA ratios will be more resilient, while banks with low LDR or short-term capital ratios for medium and long-term loans will be under less pressure.

Rong Viet Securities (VDSC) expects that credit growth will slow further due to Covid-19. If GDP growth is negative in the third quarter, the State Bank of Vietnam (SBV) may continue to cut the operating interest rate.

The State Bank of Vietnam cut operating interest rates three times last year, but according to Deputy Governor Dao Minh Tu, now is not the right time to make further cuts. The reason is that the central bank is already implementing a range of synchronous solutions, such as lowering interest rates and structuring loans.