Vietnam's interbank interest rates saw a sharp increase on 30/6, with the average overnight rate hitting 13%. This surge, the highest since late March, followed approximately two weeks of lower rates, according to data from the Vietnam Interbank Research Association (VIRA). The overnight rate, a key lending term in the interbank market, jumped from 4-6% in prior sessions. Rates for one-week, two-week, and one-month terms also rose, reaching 8-8,5%.

Interbank interest rates represent the cost for banks to lend to each other. This lending is crucial for managing short-term liquidity, ensuring solvency, and meeting mandatory reserve requirements set by the State Bank of Vietnam (SBV). Since late last year, interbank lending rates have seen strong increases in many sessions. Experts note that increasing liquidity pressure and capital balance challenges have made some banks more reliant on interbank funding, driving these rates higher. If this situation persists, deposit and lending rates in the broader market could face upward pressure.

To address the liquidity crunch, the State Bank of Vietnam intervened on 30/6 by injecting funds through open market operations (OMO). On the same day, the SBV offered 38,000 billion VND via collateralized lending at an interest rate of 4,5%. Banks borrowed nearly 31,600 billion VND through this mechanism. As 17,000 billion VND of older loans matured and were repaid, the SBV injected a net amount of nearly 14,600 billion VND into the system. The central bank did not issue treasury bills to absorb liquidity, indicating its focus on boosting available funds.

Further supporting liquidity, on 29/6, the SBV also initiated 7-day USD/VND swap operations with commercial banks. The transactions, executed on 30/6, involved the SBV buying spot USD from banks and temporarily injecting an equivalent amount of VND into the system. After 7 days, the SBV will sell back the USD and withdraw the VND.

By Quynh Trang