Interest rates decline but remain high

HCMC – After four consecutive policy interest rate cuts by the central bank, the average annual rates on deposits and loans on the market have decreased by one percentage point against late last year.

Speaking at a State Bank of Vietnam (SBV) conference this morning, July 15, on the January-June performance of the banking sector and solutions for the second half of this year, SBV deputy governor Dao Minh Tu, said borrowing and lending rates have been declining.

Commercial banks have reduced lending rates by 0.5-3 percentage points for new loans, Tu told the conference, which was also attended by Prime Minister Pham Minh Chinh.

As of June 30, total outstanding loans in the banking system had reached over VND12,490 trillion, up 4.73% versus the end of 2022.

As interest rates are still high, PM Chinh requested the banking sector to reduce costs to make it possible to further lower interest rates, especially for loans.

Given low credit growth and difficult access to loans, PM Chinh asked the banking system to ease lending conditions to inject capital into production and business, especially small and medium-sized ones.

The PM also urged the banking sector to expedite the implementation of the VND120 trillion credit package for social housing and the VND40 trillion interest subsidy package.

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