The total interbank trading value of the dong rose 16.7 percent to VND131.123 trillion in the week ending July 13 while that of the dollar fell 3.2 percent to VND56.487 trillion equivalent, said the State Bank of Vietnam (SBV) on its weekly banking review.
Transactions in the interbank market were mostly for short terms which accounted for VND86.688 trillion or 66 percentof the total dong turnover during the week. Meanwhile, short term turnover of U.S dollars was VND46.439 trillion equivalent or 82 percent of the total turnover in the greenback.
The average dong interest rates on the interbank market fell for almost all terms, ranging from 0.93 percent for 3 month terms to 1.65 percent for 6 month terms. Interest rates for overnight fell 1.03 percent to 5.03 percent.
However, for 12 month terms, interest rate rose 0.75 percent and 4.52 percent, respectively. No loans of over 12 months maturities in the currency were lent out during the period.
The average interbank interest rates for dollars fell for 1 and 2 week terms and 3 and 6 -month terms While the rates for other terms rose, especially for 12 month term interest rate rose by 1 percent to 4 percent. Of note, no loans of over 12 months maturities in the currency were lent out during the period.
During the week, the dong deposit interest rates were stable, mostly 1-2 percent p.a. for demand deposits; 2 percent p.a. for under 1 month terms; 8.8-9 percent p.a. for terms from 1 to 12 months and 10-12 percent p.a. for over 1-year maturities.
Dollar deposit interest rates were mostly 2 percent p.a for individuals and 0.5 percent-1 percent for institutional depositors.
Lending interest rates in the domestic currency were stable, at 11-13 percent p.a. for agricultural producers, exporters and supporting industry; and 12-16 percent p.a. for other businesses and production.
Following the governor announcement No 198/TB-NHNN on July 9, 2012, credit institutions have actively reviewed their outstanding loans to adjust lending rates down to 15 percent from July 15.
In the week, STB launched a package of VND2 trillion loan to businesses at 13 percent interest rate per year.
Dollar lending interest rates were mostly 5.5-7.5 percent p.a. for short terms; and 7.5-9 percent p.a. for medium and long terms.
Dollar trading last week were in the positive direction and liquidity in the banking system was good. The dollar prices at commercial banks were reported to hover around VND20,845 and VND20,875 for bid and ask, respectively. Commercial banks net-bought dollars from customers, exchange rate was on the decline.