Dollar deposit rates drop as SBV cap takes effect

Many commercial banks have reduced interest rates on US dollar deposits by nearly 50 percent after the State Bank of Viet Nam’s three percent cap directive took effect on Wednesday, April 13.

The new cap would benefit both depositors and the economy by stabilising the foreign exchange market, experts said.

The Commercial Joint Stock Bank for Foreign Trade of Viet Nam (Vietcombank) and the Viet Nam Export-Import Commercial Joint Stock Bank (Eximbank) cut their US dollar deposit interest rates from 5.5 percent to 3 percent for 1 to 60 month term deposits.

At the Sai Gon Thuong Tin Commercial Joint Stock Bank (Sacombank) the interest rate was reduced from 4.8 percent to 3 percent on one to 24 month deposits.

Rates of 3 percent, 2.8 percent and 2.75 percent now are being applied respectively on dollar deposits with terms from one to six months, seven to nine months and 10 to 11 months at the Viet Nam Technological and Commercial Joint Stock Bank (Techcombank).

The big gap created between interest rates on dong and dollar deposits (current 3 percent and 14 percent) has encouraged many people to shift their deposits from US dollar to dong.

In a move to exert better over the foreign exchange market, the central bank recently submitted a few proposals on controlling the gold and foreign currency markets to Prime Minister Nguyen Tan Dung. – VNS

Tags: US dollar deposit rates