Specifically, besides cutting the refinance rate and the open market operation (OMO), the State Bank also adjusted the maximum interest rate for deposits in Vietnamese dong.
Accordingly, the maximum interest rate applicable to demand deposits and terms less than one month is 0.2 percent per annum; the maximum interest rate applicable to deposits with terms from one month to less than six months decreased from 4.25 percent per annum to 4 percent per annum. SBV said that it decided to reduce the operating interest rates to continue to resolve difficulties for the economy.
On October 1, many commercial banks have sharply reduced the deposit interest rates, bringing the interest rates under six months to below the mark of 4 percent per annum. For example, the new interest rate of DongABank from October 1 for terms from one to five months fell by 0.42 percent to 3.83 percent per annum. Saigonbank also adjusted from 0.2 to 0.7 percentage points in some terms compared with the previous ones; Kienlongbank slashed a maximum of 0.6 percentage points. OCB also lowered its deposit interest rates up to 0.25 percentage points compared to before. Not only reducing deposit rates at the counter, but some commercial banks have also reduced online savings rates, which are often higher than interest rates at the counter, to 4 percent per annum following the regulations of the State Bank.
In related news, Vietnam's stock market wrapped September with all three indexes, comprising the VN-Index, HNX-Index, and UPCoM-Index, gaining points compared to the previous month. Particularly, at the end of September 30, the VN-Index stood at 905.21 points, equivalent to an increase of 9.71 percent in the third quarter of this year. According to the world’s best performing stock markets, Vietnam’s stock market ranked fourth among the top ten markets with the highest increases in September, after Mongolia with 4.27 percent, Turkey with 4.06 percent, and Denmark with 3.48 percent. Thanks to the strong recovery in the second and the third quarters of this year, the VN-Index is now only 5 percent lower than that at the beginning of the year.