HCM CITY — The government has ordered inspections of commercial banks that have raised deposit interest rates and mandated strict penalties for non-compliance, all aimed at achieving an 8 per cent growth target.

In his directive, Prime Minister Phạm Minh Chính emphasised the importance of lowering lending rates to support economic growth.

“Maintaining low interest rates is vital for meeting the national GDP growth goal of 8 per cent or higher in 2025,” he noted.

Despite previous guidance, several banks have increased deposit rates, negatively impacting lending.

The State Bank of Việt Nam (SBV) has been tasked with leading inspections and addressing violations, which may include imposing credit growth limits or revoking licences. 

A report on actions taken is expected by the end of the month.

The Prime Minister also urged the SBV to ensure transparency in interest rate announcements and to encourage banks to reduce operating costs and leverage technology. 

Credit should be prioritised for production, traditional sectors, and emerging growth areas such as digital transformation and green initiatives.

At a recent meeting, SBV Deputy Governor Đào Minh Tú said credit growth could exceed the 16 per cent target for 2025, depending on inflation control and favourable economic conditions. 

The SBV aims for 16 per cent credit growth this year, in line with the GDP target. 

Maintaining stable inflation and a stable currency is essential, and the SBV will implement a flexible monetary policy while intervening in the foreign exchange market as necessary, according to Tú.

Deposit rates reached a peak of over 12 per cent per annum at the end of 2022, following the collapse of a private bank, which the SBV had intervened in to manage in order to safeguard the system's safety.

As a result, deposit interest rates began to decline in March 2023, ultimately reaching a historic low of around 4 per cent per annum for both state-owned and private banks.

However, there has been a recent resurgence in the rates, with the current averages standing at 5 per cent for state-owned banks and over 6 per cent for private banks. — VNS