Vietnam banks lift deposit interest rates

More than a dozen small- and medium-sized commercial banks in Vietnam have raised deposit interest rates since the start of this month, commonly by 20-30 basis points.

This is the first hike by banks since rates fell to all-time lows over the past year.

Rates have gone up at ACB, BacABank, BVBank, GPBank, TPBank, Shinhan Bank, Techcombank, Sacombank, GPBank, NCB, PGBank, SeABank, CB, and VIB.

Techcombank has raised rates on deposits with terms of between three and 24 months by 20-40 basis points (bps). It is offering 4.9% per annum for savings of 12 and 14 months, up from 4.7%.

OceanBank, an ailing bank acquired by the central bank back in 2015 at zero cost, is offering 5.4% per annum for less-than-12-month deposits of less than VND1 billion ($39,310). Clients can enjoy an annualized rate of 6% on 24-month savings, the highest among all local banks.

Notably, several banks are offering outstanding rates for big deposits. HDBank is offering 7.7% for 12-month deposits and 8.1% for 13-month deposits of at least VND500 billion ($19.64 million).

PVcomBank, with 52% owned by Petrovietnam and 6.66% by Morgan Stanley, is offering 9.5% for deposits worth at least VND2 trillion ($78.6 million) over 12-13 months.

State-controlled banks have not joined the race. Vietcombank, Agribank, and BIDV are listing deposit rates at below 5% across all terms. VietinBank is the only one of the Big 4 to offer 5% for 24- and 36-month deposits.

Saving interest hikes come after deposits dropped for the first time after rising for 25 months running.

These increases may have been driven by a pickup in loan demand, local media quoted experts as saying. However, they ruled out drastic rises in deposit rates in keeping with the central bank’s policy to keep rates steady to support local firms and economic growth.