Vietnam Banks to Cut USD Interest Rates Soon
Domestic commercial banks are predicted to slash their interest rate on US dollar deposits in a couple of weeks despite the soaring demand for foreign currencies early next year, said experts.
It is mostly attributed to the fact that US dollar deposit interest rates applied by local banks are now 1 per cent higher than those newly announced by US Federal Reserve (FED).
In October, Vietcombank cut its US dollar deposit interest rates; just two weeks after the FED reduced the interest rate from 5.25 per cent to 4.75 per cent. The bank’s representative said the rate reduction will not affect the bank’s US dollar capital mobilization.
Vietnam Export Import Commercial Joint Stock Bank (Eximbank), one of the domestic banks that have raised the US dollar deposit interest rates many times before, has wrapped up a plan for its sixth interest rate adjustments so far this year.
Eximbank’s 12-month term deposit interest rate is now 5.25 per cent per annum, equal to FED’s rate at the beginning of the year, said Deputy Director General of Eximbank Dao Hong Chau, adding that interest rate adjustment could be done next week.
The Viet A Bank, which raised the US interest rate to 5.7 per cent/month in September 2007, is also planning to lower the rates to optimize profits.
Director of a joint stock bank said the demand for foreign currencies is normally increasing in the final months of the year because importers need more dollars to import goods to sell on Tet and banks require huge sums of foreign currencies to make gold deals.
Shortage of US dollars, however, will not occur as banks have mobilized large amount of from raising deposit interest rates in the second quarter of the year while overseas remittances are forecast to come in big volume early next year. (www.vietstock.com.vn)
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