Most banks have agreed to reduce the highest lending interest rates on VND loans to 15 percent while some will also lower deposit rates by 0.5 percent. The measures were announced at a conference held April 14 in Hanoi by the State Bank of Vietnam.
At the conference, SBV Governor Nguyen Van Giau presented a circular on lending under negotiable interest rates, asking commercial banks to publicly announce their rates.
Under the circular, the negotiable interest policy is now extended to short-term loans.
The applied interest must be determined on the current demand for loans, the basis of supply and demand, the integrity of borrowers, and the potential profitability for banks.
Loan interest rates must be affordable for borrowers, especially small- and medium-sized enterprises (SMEs), and agriculture and export businesses, the governor said.
After announcing the new interest rates, commercial banks must report them to the central bank, he added.
The central bank has issued a dispatch requiring the Vietnam Banking Association to take measures that ensure deposit and lending rates adopted by its members will benefit depositors, lender, and borrowers.

During the conference, most banks agreed with recommendations from the SBV and the Vietnam Bankers’ Association that negotiable interest rates on short-term loans should initially be less than 14 percent per year and that rates on medium- and long-term loans should be 14.5-15 percent at maximum.
Several banks have already announced their new rates. For example, Agribank will apply a rate of 13.2 percent for agribusiness borrowers and 14 percent for exporters; and at BIDV, the rates are 13 and 12 percent respectively.
Meanwhile, Military Bank and Maritime Bank are offering loans to exporters at 13.7 and 12 percent per year respectively; and Sacombank will apply a rate of 13.8 percent for agribusiness borrowers, 14 percent for exporters, and less than 15 percent for other clients.
At ACB, the lending rate on short-term loans is set at 14-14.5 percent per year, while rates of 14.5 and 15-15.5 percent are offered on medium- and long-term loans.
Deputy general director of the Asia Commercial Bank (ACB), Do Minh Toan, forecast that lending rates will decrease by 1-1.5 percent to 13-14 percent per year in the near future – possibly the second quarter of this year.
Mr. Toan said ACB has applied four lending rates based on client classification. Accordingly, a rate of 13.8 percent is applied for borrowers with a long, positive credit history with the bank; 14 percent is applied for regular customers; 15 percent is applied for SMEs; and 15-16 percent is applied for individual borrowers.
Nguyen Hao, director of the Hoang Tan Printing and Sewing Co., Ho Chi Minh City, said, “I hope that by mid-year, when we begin fulfilling our orders, the lending rates will go down to 10 percent per year, since we cannot afford loans at higher rates.”
Meanwhile, Le Van Truong, deputy chairman of the Management Board of Khanh Hoi Import-Export JSC, HCMC, said, “Recently, our forestry processing enterprise in Binh Duong Province has been progressing sluggishly while waiting for a reduction in lending interest rates. I hope that in June, when the enterprise’s operations peak, lending rates will further drop to 12 percent per year – the maximum rate we can afford.”
New deposit interest rates
Also during the conference, banks agreed to reduce deposit interest rates by 0.5 percent per year from the current maximum rate of 12 percent. Soon after that, many commercial banks announced their new range of deposit interest rates, with the maximum being less than 12 percent per year.
Viet A Bank will offer a deposit interest rate of 11.8 percent per year for a 12-month account; while the rates for accounts of three, six and nine months are set at 11.5, 11.6 and 11.7 percent respectively. For one-month deposits, the rate is 11 percent.
With this range, the bank will find it easier to mobilize idle money than previously when a ceiling rate of 10.5 percent was applied.
At Eximbank, the maximum deposit interest rate is 11.5 percent per year for a 12-month account; while the rates for three-, six- and nine-month deposits are 11.40, 11.43 and 11.45 percent respectively.
Sai Gon Thuong Tin, meanwhile, will offer lower rates of 11.1 percent for a one-year account and 10.56 percent for one-month deposits.
Mr. Toan of ACB said that many commercial banks want to reduce deposit rates slowly, fearing that a one-time reduction will discourage depositors, causing a decline in banks’ capital mobilization.