BVSC: Deposit rates up and down

Since credit has grown significantly in the opening month of the year and inflationary pressure has increased, many commercial banks have raised their deposit interest rates to attract funds.

According to the Bao Viet Securities Company (BVSC), the average deposit interest rate rose slightly in the first month of 2022, on both six-month and 12-month terms, to 4.79 per cent and 5.552 per cent, respectively.

While State-owned joint stock commercial banks kept their interest rates unchanged, other commercial banks made various adjustments.

On average, small-sized commercial banks, with capital of less than VND5 trillion ($220.6 million), cut their interest rates on six-month terms by 0.04 percentage points to 4.44 per cent per annum, while raising the 12-month rate by 0.003 percentage points to 6.058 per cent per annum.

Conversely, large-scale commercial banks, with capital of more than VND5 trillion ($220.6 million), on average increased six-month rates by 0.09 percentage points to 4.79 per cent per annum but cut rates on 12-month terms by 0.002 percentage points to 5.307 per cent.

According to data from the State Bank of Vietnam, as of January 28, outstanding credit increased 2.74 per cent compared to the end of 2021.
Though inflation was 1.94 per cent in January, BVSC believes that inflationary pressure will be even higher when prices of many materials experience a strong upwards trend.

“The prospects for reopening the entire economy will also make credit demand continue to be high,” the BVSC research team said. “These pressures may cause commercial banks to raise deposit rates.”