Total outstanding loans of the whole banking system as of March 26, 2012 were estimated to decline by 1.96 percent from end-2011 while total deposits rose by 1.39 percent from late last year, the State Bank of Vietnam (SBV) said on a statement released Tuesday.
As of March 26, the country’s broadest measure of total money supply, or M2, surged 1.06 percent from end-2011. Non-prioritised lending accounted for 10.77 percent in late February, down from 11.02 percent as at the end of last year.
Global gold price soared in the last few days of February, helping to narrow down the local gold premium to VND200,000/tael. Since early March, the gold premium extended as world gold prices started to decrease sharply. As of March 27, SJC gold was traded at VND44.5 million/tael, VND1.7 million/tael higher than the world prices.
The central bank kept the interbank dollar exchange rates unchanged at VND20,828/USD since December 26, 2011. The dollar prices at commercial banks were reported to hover around VND20,800 and VND20,860 for bid and ask, respectively.
On March 13, the central bank decided to adjust down benchmark interest rates and deposit rate caps by 1 percent. Specifically, the central bank slashed the refinancing rate to 14 percent p.a. from previous 15 percent p.a. and lowered the deposit interest rate cap by 1 percent to 13 percent p.a.
Accordingly, refinancing rate was cut to 14 percent p.a. from previous 15 percent p.a. and discount rate to 12 percent p.a. from previous 13 percent p.a., electronic interbank rate to 15 percent p.a. from previous 16 percent p.a.
The dong deposit interest rate from 1-month terms was trimmed down by 1 percent to 13 percent per annum and rate cap on demand and under 1-month deposits was lowered at 5 percent p.a. from previous 6 percent.
Commercial banks en masse adjusted down the dong deposit interest rates by 1 percent p.a., following the central bank’s decision to cut rate caps. The deposit rates were mostly 3-4 percent p.a. for demand deposits; 4-5 percent p.a. for under 1 month terms and 11.5-13 percent for terms of 1 month and above. Lending interest rates in the domestic currency were 14.5-16 percent p.a. for agricultural producers and exporters (13.5 percent p.a. as the lowest), 20-25 percent p.a. for non production and 16.5-20 percent p.a. for others (15 percent p.a. as the lowest).
Dollar deposit interest rates ranged from 1.9-2 percent for individuals and 0.5 percent for economic organisations. Meanwhile, lending interest rates were mostly 6-7.5 percent p.a. for short terms; and 7.5-9 percent p.a. for medium and long terms.
Interest rates in the interbank market rose significantly about 10 days before the Tet holidays; yet starting to ease from early February as the central bank actively support liquidity to local commercial banks through open market operations. Currently, interbank rates were 8-9 percent p.a. for overnight, 9-10.5 percent p.a. for 1-week, 10-11.5 percent p.a. for 2-week and 12-13 percent p.a. for 1-month terms.
In Q1/2012, the central bank unprecedentedly classified local banks into 4 groups to assign different credit growth targets in 2012. Specifically, the SBV set maximum credit growth rate at 15 percent for Group A (healthy banks), 15 percent for Group B (moderately healthy banks), 8 percent for Group C (unhealthy banks) and 0 percent for Group D (weak banks).