Almost all commercial banks have pushed deposit and lending interest rates to the levels as high as possible, presently.
Almost all commercial banks have pushed deposit and lending interest rates to the levels as high as possible, presently.
Dong interest rates in the market continue rising while the room for capital supply and demand remains tight. Thus, many people said that there should be secret negotiation between some banks and clients to ignore state management bodies.
As announced by the State Bank of Vietnam, the basic interest rate of January continued being kept unchanged at 8 percent a year and then the commercial interest rate continues being maintained at the maximum rate of 12 percent a year.
Deposit interest rates for 12-month terms at state-owned banks now average at 10.4 percent – 10.49 percent a year; 10 percent – 10.49 percent a year at commercial joint stock banks. However, the average lending interest rate, both short and medium terms, is kept at the ceiling level of 12 percent a year at both state owned banks and joint stock banks.
Ly Xuan Hai, general director of Asia Commercial Joint Stock Bank (ACB), commented that “That interest rates become hot is because demand for raising deposits is very tense.” Such a move is resulted from three reasons.
Firstly, the regulation that commercial banks are not allowed to use loans from the inter-bank market to meet demand for loans in the economy pressurises capital demand at banks.
Meanwhile, businesses, after working half-heartedly to maintain their existence in 2009, have high demand for capital in 2010 when the economy recovers strongly.
The two pressures have forced banks to raise more deposits from residents. This can be seen clearly through deposit interest rates and promotion programmes that commercial banks launch.
The final reason is that under the above circumstance, behaviours of deposits in 2010 are also different from 2009. For example, instead of depositing money for four, six months or one year, they deposit money within only one week. Meanwhile, banks in turn cannot raise one-week deposits, and then offer one-week loans.
Thus, behaviours of banks are also different from previously and this makes money making coefficient in the economy smaller.
With the on-going movements, which have exactly reflected the rule that “demand increases, supply decreases, and then prices increase” together with the unchanged basic interest rate of 8 percent a year from January and the maximum commercial interest rate of only 12 percent, people worry over secret negotiation about capital between some banks and depositors as well as between banks and borrowers.
Regarding such an issue, Le Xuan Nghia, vice chair of the National Financial Supervising Committee, said that “the market always behaves in line with the rule. If we let the market operates normally, interest rates would always reflect exactly capital price. If we distort this place, another would swell; if we reduce this place, another place would automatically increase.”
Nghia added that if there is an unreasonable interest rate and forex rate policy, the black market would appear right inside the banking system but not only in the street, which leads to two kinds of forex rates and interest rates, formal and secret negotiated rates.
From such a reality, some financial experts worried that “This is the premise for ethical risks, which deteriorates conducts of some bank officials. If such a situation prolongs, there would be unforeseeable results.”
Source:VNBusinessNews.com -
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