Banks raise short-term deposit rates to more than 8%

Tuesday, Sep 24, 2019 15:34

Saigon Commercial Bank (SCB) has just announced interest rates of up to 8.21 per cent for six-month online deposits. — Photo SCB

Commercial banks have recently raised their interest rates for six-month deposits to a record high of more than 8 per cent per year.

The rate was previously reserved for long-term deposits of more than a year.

Saigon Commercial Bank (SCB) has announced interest rates of 8.03 per cent for six-month online deposits, rising to 8.21 per cent for deposits valued at VND10 billion (US$435,000) and above.

This adjustment gives SCB the highest deposit rate for six month terms.

The bank's rate also rises to 8.76 per cent for 13-36 month deposits of VND10 billion upwards.

Nam A Bank is also listing an 8 per cent rate for six month deposits. The bank’s rate for 7-9 month deposits is at 8.05 per cent per year, while its highest rate of 8.7 per cent applies for 36-month deposits.

Viet Capital Bank, Eximbank and VietBank have also set interest rates for six month deposits at 7.5-7.7 per cent per year.

However, interest rates for six-month deposits at State-owned banks Vietcombank, Vietinbank and BIDV remain stable and low at 5.5 per cent per year. Rates for long-term deposits of 12-36 months stand at only 6.8 per cent per year.

It is estimated nearly 20 commercial banks, mainly small and medium ones, are listing deposit interest rates at more than 8 per cent per year in a bid to raise capital to meet international banking Basel II standards set by the State Bank of Viet Nam (SBV).

Viet Capital Bank, which has the highest interest rate on the market of 10.2 per cent per year for 60-month deposits, has asked the SBV for permission to apply for Basel II earlier than expected by the end of the third quarter this year. The SBV's deadline for all banks to apply Basel II is January 2020.

The SBV expects interest rates to remain stable until the end of this year after its decision to cut several key interest rates by 0.25 percentage points from September 16 to help credit institutions access capital at more affordable costs, in turn enabling the institutions to improve liquidity and keep interest rates stable. VNS

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