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After two increases in April, the National Citizen’s Commercial Joint Stock Bank (NCB) has continued to raise interest rates for deposits from May 3. Specifically, deposit interest rates for terms of 6 – 10 months and 12 – 36 months have all increased by 0.2%, while the interest rate for the 11-month term has increased by 0.1% and the interest rate for terms under 6 months has remained the same. Currently, the highest deposit interest rate at NCB has increased to 5.7%/year, applied to deposits with terms from 24-60 months.
Vietnam Oil and Gas Commercial Joint Stock Bank (GPBank) also issued a new savings interest rate table starting from May 3, with a significant increase in many terms.
Accordingly, GPBank has adjusted the savings interest rate from 6 to 36 months up by an average of 0.2-0.3%. For the remaining terms, this bank has kept the interest rates unchanged.
Right after the holiday, Asia Commercial Joint Stock Bank (ACB) has adjusted the deposit interest rates up. According to the latest savings interest rate table, ACB has increased the deposit interest rate for terms from 1 to 3 months by 0.2% for all deposit levels.
The trend of increasing deposit interest rates has been happening since the end of March and has been taking place on a broad scale in April. According to our survey, in April, up to 16 banks increased savings interest rates, including: HDBank, MSB, Eximbank, NCB, Bac A Bank, GPBank, OceanBank, BVBank, PVComBank, CBBank, BIDV, TPBank, VPBank, KienLong Bank, VietinBank, ACB. This is also the first time in the past year that the number of banks adjusting interest rates up has been so large.
Of which, VPBank and KienLong Bank are the banks that have adjusted the savings interest rate up twice in some terms.
OceanBank is the bank that has adjusted interest rates up the most across all terms, with an average increase of 0.1-0.9%/year. After this adjustment, the market has started to record an interest rate of over 6%/year when OceanBank raised the interest rate for the 36-month term to 6.1%/year.
The fact that many banks are increasing deposit interest rates again is taking place in the context of a decreasing scale of deposits in the banking system. The data from the General Statistics Office (GSO) has just been announced, showing that as of March 25, capital mobilization of credit institutions decreased by 0.76% compared to the end of 2023. According to data from the State Bank updated until the end of January 2024, the amount of deposits of individuals at banks has decreased by nearly 35,000 billion compared to the beginning of the year, equivalent to more than 0.5%; corporate and institutional deposits also decreased by 165,000 billion dong compared to the beginning of the year, down by more than 2.4%.
According to analysts, the decline in deposits of individuals and businesses along with the recovery of credit growth has caused many banks to rush to increase deposit interest rates to ensure a balance of capital resources.
Commenting on the current trend of savings interest rates, Mr. Dinh Duc Quang, Director of Monetary Business, UOB Vietnam Bank said that the average savings interest rate is at a record low level and may have bottomed out in the overall assessment of the yield of this least risky investment channel compared to inflation, exchange rates and capital demand in the economy.
Mr. Quang further analyzed that although economic activity has improved in the first quarter of 2024, especially the recovery in foreign trade activities, other factors such as industrial production, domestic consumption, retail, new orders still need more clear data in the coming time to confirm the trend of solid growth; thereby supporting the confidence of businesses and investors to boldly access credit, expand production investment and consumption. Looking at the data longer than before the Covid dịch also shows that domestic credit has often tended to increase very slowly in the first quarter and only started to recover in the second quarter of each year.
“From that assessment, we believe that savings interest rates could increase by 0.5%-1% in different terms from the second half of 2024,” Mr. Quang forecast.
In a newly released analysis report, MB Securities (MBS) also believes that input interest rates are likely to bottom out in the second quarter of 2024 and improve slightly amid the potential for economic recovery and gradual credit improvement.
MBS expects deposit interest rates to increase by about 0.3 – 0.5% and will gradually approach the interest rate at the beginning of the year.
Along with analysts, many bank leaders also make forecasts about the slight increase in savings interest rates again.
According to Mr. Luu Trung Thai, Chairman of the Board of Directors of MB Bank, deposit interest rates are unlikely to be maintained like the early months of the year. Interest rates are likely to move sideways or increase from now until the end of the year.
At the 2024 Annual General Meeting of Shareholders, Mr. Tran Hung Huy, Chairman of the Board of Directors of ACB Bank, also said that the increase in interest rates from now until the end of the year will not be much, although interest rates will likely increase every quarter.
Mr. Nguyen Hoang Linh, General Director of MSB, also said that deposit interest rates will continue to increase from now until the end of the year when the economy passes through a difficult period and credit demand increases again.
