The State Bank of Vietnam (SBV) announced to remove the interest rate cap of 9 percent per annum for deposits of over 12-month maturities, the central bank said in a statement posted on its website last Friday.
Interest rates offered on above 1-year deposits will solely be determined by credit institutions based on supply and demand on the market, the SBV noted.
As reported earlier, the dong deposit interest rate cap from 1-month terms is reduced by 2 percent to 9 percent per annum and rate cap on demand and under 1-month deposits is capped at 2 percent p.a. from current 3 percent.
As such, lending rates are now capped at 12 percent p.a. for four prioritised sectors, including agriculture, exports, supporting industries and small and medium enterprises (SMEs).
Besides, refinancing rate will be cut to 11 percent p.a. from current 12 percent p.a. and discount rate to 9 percent p.a. from current 10 percent p.a., electronic interbank rate to 12 percent p.a. from current 13 percent p.a.
The SBV also reduces the rate cap from 1-month deposits at grass-root People’s Credit Funds from 11.5 percent p.a. to 9.5 percent p.a.