Commercial banks have pledged to lower interest rates following a meeting on 9/4 with Governor Pham Duc An of the State Bank of Vietnam (SBV). The meeting focused on conveying directions for interest rate management.
The SBV highlighted a volatile international landscape, particularly geopolitical tensions in the Middle East, which have driven oil prices up and put pressure on inflation. Recently, high capital demand and competition among some banks for deposits have pushed interest rates higher.
To support businesses and individuals, banks at the meeting agreed to implement the Government's and the SBV's policy of reducing the overall interest rate level. Banks committed to adjusting both deposit and lending interest rates downwards immediately after the meeting.
The SBV stated it would closely monitor market interest rate developments, requiring banks to transparently publish interest rates on their websites. The central bank also confirmed its readiness to provide liquidity support when necessary. Furthermore, the regulatory body will enhance inspection, supervision, and strictly address violations in capital mobilization and credit extension activities.
 |
Governor Pham Duc An addressing the 9/4 meeting. Photo: SBV |
According to information from the meeting, Mr. Pham Chi Quang, Director General of the Monetary Policy Department, stated that during the first three months of the year, monetary policy was managed proactively and flexibly. This approach aimed to stabilize macroeconomic conditions, control inflation, and support growth.
Mr. Quang noted the SBV's flexible management of open market operations, offering to buy valuable papers with diverse maturities to support system liquidity. Exchange rates and the foreign currency market were also managed in line with market developments, combining various tools to ensure macroeconomic stability.
Regarding credit, the agency aimed for growth of around 15%. It also required credit institutions to control capital flows into risky sectors such as real estate. Credit should be prioritized for production and business activities and areas that drive growth, limiting non-performing loans.
The SBV affirmed its commitment to maintaining policy interest rates. This aims to enable credit institutions to access low-cost capital, thereby supporting the economy.
Quynh Trang
