Vietnam banks cut deposit rates as state lenders join easing trend

Vietnamese banks have begun lowering deposit rates in a coordinated move following guidance from the State Bank of Vietnam, with major state-owned lenders joining the trend to help steer market conditions.

The adjustments came after a meeting on Thursday between the central bank and representatives of 46 commercial banks, with multiple lenders announcing rate cuts the following day.

SeABank was among the first to act, reducing deposit rates by 0.5 percentage points for tenors of six months and longer. Rates now stand at around 5.15% per year for six-month deposits, 5.5% for 12-month and 5.95% for terms of 18-36 months.

Other joint stock lenders, including VPBank, VietABank, BVBank and Vikki Bank, also cut rates by between 0.2 and 0.5 percentage points, reflecting broad alignment with the central bank’s policy direction to lower borrowing costs and support economic growth.

Analysts say declining deposit rates, particularly for medium- and long-term tenors, could help banks reduce funding costs and create room for lending rate cuts in the coming months.

In a notable move, state-controlled Vietcombank said it would lower deposit rates from April 13, becoming the first among the “Big Four” state lenders to bring all rates below 6% per year.

Its 24-month deposit rate was cut by 0.5 percentage points to 6% per year, while rates for 12- to under-24-month tenors are under review and may be trimmed further. Short-term rates remain unchanged.

The move effectively sets a new benchmark for large state-controlled banks, putting pressure on peers such as BIDV, VietinBank and Agribank to follow suit. These lenders currently offer around 6.5% per year for 24-month deposits but are expected to adjust soon.

At the 12-month tenor, all four banks are maintaining rates at 5.9% per year, higher than roughly 5.2% a month earlier, suggesting a gradual and lagged adjustment process.

Economists say the participation of major state banks is particularly significant, as it not only lowers their own funding costs but also sets a reference level for the broader market.

Le Xuan Nghia, a member of the National Financial and Monetary Policy Advisory Council, said interest rates remain a central variable in macroeconomic management.

“Interest rates are not only a monetary policy tool but also a key factor influencing investment decisions and the economy’s capacity to absorb capital,” he said.

High funding costs tend to make private firms more cautious about expanding operations, limiting total investment and potentially constraining growth, he added.

Nghia said interest rate policy needs to remain flexible and be closely coordinated with fiscal measures and efforts to improve the investment climate in order to sustain growth momentum.