Deposit Interest Rate Hits New Peak in Vietnam

The latest decision by Vietnam's central bank on raising base interest rate have already triggered a new race among local joint stock commercial banks to hike interest rates to a new peak of 19.2 per cent per annum set by the SeABank on 13-month term deposits, state media reported.

 

The State Bank of Vietnam (SBV), or central bank, issued a decision June 10 to increase the base interest rate for Vietnam dong by 2 per cent to 14 per cent. The new interest rate has been applied from June 11.

 

Right on the first day the decision went into effect, SeABank became the pioneer in the race as it announced higher deposit interest rates applied for all terms. The rates for its 6-month and 12-month term deposits have been raised to 18 per cent and 18.6 per cent, respectively.

 

On the same day, the Dai Duong Joint Stock Commercial Bank (OceanBank) raised its savings interest rates for almost all terms, such as 17.5 per cent-17.7 per cent per annum for short-and medium-term deposits and 17.8 per cent for long-term deposits.

 

With higher deposit interest rates, commercial banks expected to attract more Vietnam dong funds to address their liquidity issue. (Vietnam Economic Times)