Vietnamese individuals' deposits hit record high of $276 bln on higher rates, caution

Deposits by Vietnamese citizens in banks in Vietnam reached a record high of nearly VND6.84 quadrillion ($276.17 billion) as of end-July, a 4.68% increase compared to the end of 2023, according to the latest data from the central bank.

Individual deposits have been rising over the past two years, despite low interest rates in late 2023 and early 2024, the central bank reported. This increase reflects customers’ growing caution about economic uncertainties and alternative investment channels such as stocks and real estate, say some experts.

Additionally, deposit interest rates have been on the rise since April, helping attract more deposits to banks. Annual deposit rates have risen by 50-100 basis points since the beginning of the year, with long-term rates at some banks exceeding 6%. Several banks are offering interest rates of 6-6.15% for deposit terms of 18-36 months.

In contrast, corporate deposits fell by 1.07% to VND6.76 quadrillion ($273.34 billion). Experts suggest this decline may be due to firms seeking higher returns through new investment opportunities.