Retail depositors overwhelm banks as other asset classes remain in a slump

By Quynh Trang November 27, 2023 | 11:09 pm PT

An employee counts Vietnamese banknotes at a bank in Hanoi. Photo by VnExpress/Giang Huy

Retail bank deposits climbed to a record VND6.45 quadrillion (US$266.07 billion) at the end of September due to investors’ lack of confidence in most other asset classes.

They grew by 9.95% for the year, the fastest rate since 2018, according to the State Bank of Vietnam.

The deposits started to increase since October last year as banks pushed interest rates to over 10% at one point.

Though they have now fallen to around 6%, analysts said people are unlikely to invest immediately in stocks or property due to unfavorable conditions.

The benchmark VN-Index has been struggling to rebound after a steep fall in September-October, while the property market is only expected to recover in the second half of next year at the earliest.

Corporate deposits rose by 4.65% to VND6.23 quadrillion.

Overall, banks’ deposits were up 7.3% to VND12.68 quadrillion.