SBV injects VND127 trillion to the market in 2 months

02-Sep-2021 Intellasia | VnEconomy | 5:02 AM Print This Post

The latest report by Saigon Securities Incorporation (SSI) on the bond and capital market showed that in the last week of August, the Open Market Operation (OMO) continued to have no transactions. Meanwhile, the six-month foreign currency selling contracts ended with a total exercised value of about 5.5 billion US dollars, lower than the registered value as a number of contracts was cancelled. In the past two months (July and August), the market received more than 127 trillion dong via the foreign currency channel.

The addition of a large amount of capital helped the system liquidity maintain an abundant status. This was clearly seen in the dong interbank interest rates in the last week when the rates simultaneously dropped across the terms.

Specifically, compared to the last session of the week, the interest rates by the end of August 27th were 0.7 percent per annum on overnight term (down by 0.02 percentage point), 0.84 percent per annum on one-week term (down by 0.05 percentage point), 0.96 percent per annum on two-week term (down by 0.05 percentage point), 1.19 percent per annum on one-month term (down by 0.03 percentage point). This in the entire August, the interbank interest rate level declined by 0.15 percentage point.

In a related development, when there is not much worry about liquidity issue, banks have much actively lowered lending interest rates. Most banks have launched support credit packages to help people and businesses affected by the epidemic from now until the end of the year.

The support packages include a loan package with preferential interest rates or a further cut in lending interest rates, focusing on individual and corporate customers in the Southern provinces and cities which are implementing social distancing.

In addition to Commercial Joint Stock Bank for Foreign Trade of Vietnam (Vietcombank) and Commercial Joint Stock Bank for Investment and Development of Vietnam (BIDV) which have announced to lower lending interest rates in the past week, Commercial Joint Stock Bank for Industry and Trade of Vietnam (VietinBank) have offered another credit package with interest rates from four percent per annum and scale of 20 trillion dong, applicable to businesses seriously hit by the epidemic.

The group of private joint stock banks have also strongly cut lending interest rates to support customers, such as Military Commercial Joint Stock Bank (MBB), Asia Commercial Joint Stock Bank (ACB), Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank), etc. with reduction level of 0.5 to 1.5 percentage points.

Meanwhile, the savings interest rate on term of 12-month slightly increased by about 0.1 0.25 percentage point in the past week, recorded in some banks such as BIDV, Vietnam International Commercial Joint Stock Bank (VIB) and Vietnam Prosperity Commercial Joint Stock Bank (VPB).

In general, the lending interest rates will continue to be maintained low in the near future, while savings interest rates will be under the pressure of inching up because the Circular regulating the ratio of short-term funds used for medium and long-term loans will take effect in October.

According to SSI’s report, in the government bond market last week, the bond yields moved sideways on the primary market. In particular, the State Treasury offered 9.25 trillion dong of bonds with a significant decrease in the registered and winning rates, reaching only 175 percent and 42%, respectively. The winning interest rates levelled off on terms of 10 years and 15 years.

The government bond yields in the secondary market slightly fell by 0.01 to 0.05 percentage point, closing the week at 0.32 percent on one-year term (unchanged), 0.69 percent on three-year term (down by 0.05 percentage point), 0.84 percent on five-year term (down by 0.02 percentage point), 2.08 percent per annum on 10-year term (down by 0.01 percentage point), 2.28 percent per annum on 15-year term (unchanged), 2.83 percent per annum on 20-year term (down by 0.01 percentage point), and 2.97 percent per annum on 30-year term (unchanged).

 

Category: Finance, Vietnam

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