Deposit Rates May Continue to Rise: NFSC

StoxPlus | Wed, Jul 6, 2016 11:13:21 AM Share this on

National Financial Supervisory Commission (NFSC) forecasted so in its economic report on June 2016 and the first 6 months of 2016.

According to the report, the Q1, VND long-term deposit rates rose slightly by 0.1-0.5% p.a. from the end of 2015 and 0.3-0.7% p.a. over the same period in 2015. In Q2, the rates remained relatively stable. However, from June 14, some small commercial banks  raised long-term deposit rates by 0.7% p.a. compared to the end of 2015.

In Q1, VND long-term lending rates rose by 0.2-0.5% p.a. from the end of 2015. However, after the Prime Minister directed on supporting businesses, a number of large commercial banks revised down the rates.

In the last 6 months, NFSC forecasted that deposit rates may continue to rise in a number of small banks, especially medium- and long-term rates. However, the banking system’s liquidity is quite abundant  currently, and it will be a supporting factor to the rising credit demand by the end of the year. Moreover, as government bond issuance in H1 already hit 80% of the year’s plan, the pressure on bond yields will fall, hence facilitating lower lending rates.

Source: StoxPlus