The State Bank of Vietnam (SBV) will lower the ceiling on deposit interest rates from current 13% to 12 % per annum, said an official.

Do Thi Nhung, Deputy Director of the SBV’s Department of Monetary Policy

Do Thi Nhung, Deputy Director of the SBV’s Department of Monetary Policy, made the statement at a seminar to discuss increasing access to credit for small to medium-sized businesses, which was held in Hanoi on April 6.

“Government policies have stabilised the economy and the inflation rate since last August. This has laid the foundation to improve liquidity in the banking sector and a possible drop in lending interest rates in the future," Nhung said.

She quoted the SBV’s Governor Nguyen Van Binh, who recently said that interest rates could be reduced by 1% in the following quarters if the inflation rate stays between 10% and 11% this year.

She added that the department is actively encouraging commercial banks to lower costs to increase businesses access to bank loans at lower interest rates.

The department plans to adjust its monetary policies to foster a competitive and open market, starting with a focus on refinancing services in order to improve the liquidity of commercial banks. One of the top priorities for the SBV’s in terms of policy is to increase the access of credit for SMEs, she noted.

Part of this plan is to encourage banks to focus on mobilising medium to long-term, instead of short-term deposits.

They are also conducting further study policies that would reduce real estate speculation.

“In the long term, the SBV will continue to  issue regulations to ensure the safety of the banking system and help large-scale banks to diversify their financial products,” she said.

Previously, SBV lowered the ceiling deposit interest rate by 1% to 13% on March 13.

This year, the Government has set a target for credit growth to between 15% and 17%.

Source: Dtinews