Banks Continue to Increase Savings Interest Rates

Banks are persisting in their efforts⁤ to ⁢increase savings interest rates, despite assessments suggesting that there may‌ not be much room ⁢for further increases until the end of the year.

Recent Interest Rate Adjustments

PGBank has recently adjusted its interest rates ‍for short-term deposits, with the 1-2 month term​ increasing by 0.2%/year to 3.4% and 3.5%/year, respectively. The 3-month term⁤ interest‌ rate has also increased by 0.1%/year‌ to 3.8%/year.

OCB has also⁢ increased ​its deposit interest rates, with terms from one to eight months increasing by 0.2%/year and terms from nine to 11 months increasing by⁤ 0.1%/year. The one-month term at OCB is now 3.9%/year, while the ​two-month term is 4%/year.

Techcombank has increased its⁣ interest rate by 0.2%/year for terms under 3 months to 3.6%/year. The​ interest rate for ⁣terms of 3-5 ‌months has increased by⁣ 0.2%/year to 3.8%/year, while⁢ the interest rate for terms ‍of 6-11 months has increased by ‍0.3%/year to 4.8%/year.

Industry Trends and Analysis

Since the beginning⁤ of September, over 10⁤ banks‌ have increased deposit interest rates, including Dong A Bank,⁢ OceanBank, ​VietBank, GPBank, Agribank, and​ Bac A Bank.

According ⁢to WiGroup, a unit specializing in providing financial,⁣ economic, macro data, reports, market research, and financial technology solutions in Vietnam, the positive point in this new move is that the general level of deposit interest‌ rates at all​ terms in all commercial banking groups continues to remain low. This ⁤indicates that commercial bank liquidity is still ‍abundant.

Fund management ⁤company‌ VinaCapital has commented ​that the recent increase in savings interest rates shows⁤ that the period of ⁢reducing⁢ deposit ‌interest rates in Vietnamese‌ banks that ‍has ⁤lasted since March 2023 has now ended. Most financial experts agree that banks have little room to reduce deposit interest ⁣rates.

Higher‍ interest rates ‌are ​expected to ​encourage ‌commercial banks to hold VND, limiting interest rate arbitrage. However, ⁢the‍ State Bank of Vietnam ⁤is facing‌ the challenge of⁣ balancing ‍exchange⁢ rate stability and‍ promoting economic growth. Interest rates need to be ⁤high enough to support the dong, but not ‌so⁢ high that tight monetary policy hinders GDP growth.

Outlook and Forecasts

According to ⁣the September macroeconomic⁣ report, Vietcombank ⁤Securities Joint Stock Company forecasts that deposit interest rates may continue to increase, ​ensuring the attractiveness of holding VND. However, the increase ‌is not​ expected to be too large and has not yet created an interest rate race ‌among commercial banks.

As ‌of September 7, system-wide ‍credit has increased⁢ by 7.75% compared to the end of 2023, much lower than the target ⁤set ​at‌ the beginning of the year of 14% -⁣ 15%.