Banks lower deposit interest rates to below 6%

By Quynh Trang August 24, 2023 | 03:44 pm PT

Four state-owned banks and a dozen private lenders have dropped their deposit interest rates to below 6%from as high as7.5-8% earlier this year.

For a fifth time this year, state-owned Vietcombank, BIDV, VietinBank, and Agribank cut rates and they currently stand at a maximum of 5.8% for 12-month deposits made online.

Deposits made at the counter are paid 3% for one month, 3.8% for three months and 4.7% for six to nine months.

Private banks have cut their rates twice this month, ACB reducing its highest rate from 6.7% to 5.5% and Eximbank from 7.4% to 5.8%.

Banks are scrambling to reduce deposit interest rates since they now have excessive liquidity.

According to the central bank, credit growth this year has been only 4.56% while the year’s target is 14-15%. It even saw negative growth in July as the economy struggled and businesses faced financial difficulties.

The State Bank of Vietnam has urged banks to reduce lending interest rates on both existing and new loans by at least 1.5-2 percentage points, citing the Government's direction.