The regulator recently instructed regional directors of the State Bank of Vietnam to meet with commercial bank branches in their areas. The objective was to ensure compliance with the policy to reduce the overall interest rate level, a directive issued by the Governor in early April.

This marks the second time within one month that the State Bank has urged banks to avoid interest rate competition. The consistent message aims to maintain low lending rates across the system, which is crucial for supporting the national economy.

To reinforce these directives, the regulator also mandated inspections of interest rate reductions at commercial bank branches. Any violations discovered during these checks must be addressed promptly, and cases exceeding the local authority's jurisdiction are to be reported to the State Bank for further action.

Despite these efforts, the regulator noted that some commercial banks have recently increased deposit interest rates. This observation highlights a divergence in market behavior from the State Bank's policy goals.

A VnExpress survey conducted in mid-May provided further insight into the market. It indicated a significant decrease in the number of banks offering bonus interest rate programs compared to the previous month, with incentives also approximately 0,5% lower.

However, some banks continue to offer incentives of 8-9% for savings deposits with terms of six months or longer. These offers typically require deposit amounts ranging from several tens to several hundreds of million dong. In the past week, some institutions also slightly increased their negotiated interest rates by 0,1-0,2%.

Concurrently, publicly listed savings interest rates at banks are subject to continuous adjustments, showing both increases and decreases. By mid-May, the highest listed rate in the system (for deposits up to one billion dong) was nearly 8% per year.

Quynh Trang