Numerous banks have launched attractive credit packages with low interest rates since the beginning of the year. (Photo: VNA) Lending interest rates areprojected to continue decreasing in the near future, said experts. This is apromising sign that enables businesses and individuals to access capital atreasonable costs, supporting the recovery of production, businessactivities and consumption.
Tet is an occasion for businesses and individuals to supplementtheir capital for stockpiling goods, production, business activities andshopping. Recognising this demand, many banks continue to introduce creditpackages with attractive interest rates.
Recently, Kienlongbank announced the implementation of the programme tosupport individual clients in promoting production, agricultural development,rural areas, and meeting the demand for consumer loans and lifestyle. Clientsparticipating in this loan package will enjoy a preferential interest rate of 0%in the first month.
Similarly, HDBank has also introduced a credit package worth 10 trillion VND (410.7million USD) with a 0% interest rate for the first month.
5 trillion VND has been allocated for new individual borrowers or existingindividual clients who wish to borrow additional funds, while the rest isallocated for small and medium-sized enterprises for salary and bonus paymentsat the end of the year. The interest rates for the remaining months willfollow the current regulations of HDBank.
Although the 0% rate only applies in the first month, this initiative is stilla positive signal indicating that banks are actively reducing lending rates tostimulate credit demand.
Sacombank has recently increased its capital by up to 30 trillion VND for acceleratingproduction and business activities of corporate customers, and allocated up to 45trillion VND for lending to individual clients for both business and lifestylepurposes.
The bank applies interest rates for corporate loans starting from 3% per annumfor a 1-month term, 4% per annum for a 2-month term, and gradually increasingto 5% per annum for a 3-month term and 5.5% per annum for a 4-12 monthterm.
For individual clients, the interest rates for business loans range from 6% perannum for terms under 12 months to 7% per annum for medium to long-term loans.The interest rates for personal loans start from 6.5% per annum, with fixedrates available for 6, 12, or 24 months.
Similarly, BVBank has launched a lending programme for individual clients atthe beginning of 2024, offering preferential interest rates starting from 5%per annum.
The programme applies to new disbursals for purposes such as purchasing orrenovating residential properties, personal consumption, or capitalsupplementation for production and business.
It also reduces the lending margin to 2% per annum after the preferentialinterest rate period ends.
Previously, Nam A Bank introduced a package of 1 trillion VND for individualclients seeking additional short-term business capital or issuing paymentguarantees.
Customers can enjoy an additional interest rate reduction of up to 1.2% bymeeting certain conditions set by the bank.
Nam A Bank also allocates 3 trillion VND in incentives for lending tobusinesses and individuals engaged in the seafood value chain, supportingcustomers in supplementing working capital for aquaculture, procurement, seafoodprocessing, seafood feed and probiotics business.
In a recent report, KB Vietnam Securities JSC (KBSV) has predictedthat the deposit interest rate environment will remain relatively stable at alow level throughout most of 2024. Specifically, the 12-month deposit interestrate is projected to range from 4.85 to 5.35% per annum.
The latest update on deposit interest rates at banks as of the morning ofFebruary 1 showed that the trend of decreasing interest rates remainswidespread across most banks.
At present, Agribank and Vietcombank are the two banks in the system that offerthe lowest deposit mobilisation interest rates for terms below 12 months. Fordeposits with terms of 12 months or more, Vietcombank is currently offering aninterest rate of 4.7% per annum.
Regarding lending interest rates, KBSV suggests that the impact of maturitydifferentials and delayed interest rate reductions will likely be challengingto achieve significant decreases in lending rates.
KBSV believes that there is still potential for the average lending interestrate to decrease by an additional 0.75-1.0 percentage point in 2024.
Meanwhile, United Overseas Bank (UOB) said that with the ongoingeconomic recovery and better prospects in 2024, the possibility of furtherinterest rate cuts has diminished.
As a result, UOB experts believe that the SBV will maintain the existingrefinancing rate at 4.5%.
Rather than pursuing additionalinterest rate cuts that may face limitations due to the lower bound, theGovernment has shifted its focus towards non-interest rate measures to supportthe economy. One such measure involves prioritising credit accessibility forborrowers, according to UOB.
Another sign is the recent amendment to the Law on Credit Institutions, whichwill be effective from July 1, 2024. The amended law establishes a frameworkfor special loans from the SBV, including interest-free loans andnon-collateralised loans.
These provisions aim to support specific policy objectives, such as assistingcritical sectors and enabling emergency liquidity operations when needed, suchas in cases of mass withdrawals from banks.
Since the beginning of 2024, the State Bank of Vietnam (SBV) has fullyallocated the 15% credit growth target to commercial banks, aiming to boostcapital flow into the economy and support the recovery of businesses'production and operations.
SBV has announced its continued guidance for credit institutions to prioritiselending to sectors involved in production, priority areas and growthdrivers such as investment, consumption and exports, in accordance with theGovernment's policies. There will be strict control over credit allocation tosectors with potential risks.
On the other hand, credit institutions are required to create favourableconditions for businesses and individuals to access bank credit, and to promotethe expansion of consumer credit alongside ensuring its safety and integrity.This will contribute to mitigating the prevalence of usury.
Deputy Governor of the SBV Dao Minh Tu said that the current lendinginterest rates have significantly dropped to very low levels, including bothshort-term and long-term rates, in both priority and non-priority sectors. Theoverall interest rate has reached its lowest point in the past twodecades.
"Currently, there are still some high-interest rates remaining fromprevious periods when commercial banks mobilised funds at elevated rates,"Tu said.
"However, it is certain that in 2024, these rates will no longer bemaintained. In our management efforts, the SBV has no intention to increaseinterest rates in 2024."/.
VNA
