Hanoi (VNS/VNA) - Commercial banks have persistentlyreduced deposit interest rates, resulting in rates for many terms now standingat just above 6% per annum.

In line with this trend, Military Bank (MB) has revised its ratesdownward by 0.1-0.2 percentage point per year as of August 15, 2023.Significantly, the 12-month term interest rate at MB has fallen to a mere 6.1%per annum. This represents the lowest deposit rate within the banking system,and is even lower than the interest rate for the equivalent term at the fourlargest State-owned commercial banks: Vietcombank, VietinBank, BIDV, andAgribank.

Interest rates for other terms at MB have been set as follows:4-4.2% per annum for 1-3 month deposits; 6-6.1% per annum for 6-9 month deposits;and 6.4-6.6% per annum for 13-36 month deposits. Notably, the 6.6% rate is thehighest deposit interest rate offered by MB, and this applies to customersmaking deposits of 24 months or longer in the central and southern regions ofVietnam.

This week has also seen several other banks, includingBaoVietBank, GPBank, and VIB, lowering their interest rates by 0.1-0.5percentage point.

Specifically, the highest interest rate at BaoVietBank is only 7.4%for customers who deposit online for a term of 24-36 months and receiveinterest at the end of the period. BaoVietBank applies an interest rate of4.4-4.75% per year for terms of less than 6 months and 6.8-7% per year for aterm of less than 12 months.

Similarly, at GPBank, the highest interest rate has decreased by0.4 percentage point per year compared to last week to only 6.95% per year forterms of 13 months or more when depositing online. Interest rates for 6- and12-month deposits have also decreased to 6.65% and 7.25% per year,respectively.

At VIB, the highest deposit interest rate was down from 6.9% peryear in early August to 6.7% per year currently. The rates for 6-month and12-month deposits at VIB also see similar reductions to 6.4 and 6.5% per year

Previously, many banks, such as SHB, and HDBank, reduced theirdeposit interest rate by 0.1-0.2 percentage point per year. In which, SHBapplies the online deposit interest rate of only 6.7% per year for the termsfrom 6 to 8 months; 6.8% per year for terms of 9-11 months and 6.9% per yearfor terms of 12 months or more.

At VietABank, the interest rate for deposits from 6 to 11 monthsis 7% per year and 7.3% per year for 12-18 month deposits.

HDBank has also reduced its highest interest rate to 9.1% per yearfrom 9.3% per year as applied previously for customers depositing 300 billionvND or more with a term of 13 months. For 13-month deposits worth under 300 billionVND, the interest rate at HDBank is 7.35% per year. With a term of 12 months,HDBank applies an interest rate of 8.6% per year for deposits of 300 billion VNDor more and 7% per year for deposits of less than 300 billion VND.

Currently, the deposit interest rate of more than 7% per year isonly listed at a few banks such as DongABank, Viet A Bank and NCB. OnlyDongABank is listing the highest interest rate in the banking market at 8.3%per year, applicable to deposits of more than 1 billion VND with 13-monthterms.

Deposit interest rates at commercial banks have started to cooldown since the end of the first quarter of 2023 and fell deeply after fourpolicy interest rate cuts made by the State Bank of Vietnam (SBV), which isexpected to create more room for banks to continually cut lending interestrates.

The SBV early this week also directed commercial banks tocontinually reduce lending interest rates by 1.5-2 percentage points per yearat a minimum for both outstanding loans and new loans.

Under Document No. 6385/NHNN-CSTT, the SBV requires banks toreport their commitment to reducing lending interest rates in 2023 foroutstanding loans and new loans before August 25 this year and the results oftheir commitments before January 8 next year./.