Sixteen large banks on Oct. 12 signed an agreement to keep theirdeposit interest rates under 14 percent for one-month terms, and 6percent for non-term rates.
In recent months, severalcommercial banks have flouted regulations by offering higher interest orbonus interest to entice depositors.
Some banks also gavedepositors overnight interest of 14 percent. These practices continuedto introduce a high element of risk into the nation's banking system,said the State Bank on Oct. 12.
The Oct. 12's agreementwas signed by Vietcombank, Vietinbank, Agribank, Vietnam DevelopmentBank, Techcombank, Maritime Bank, VIB, VP Bank, PG Bank, Bao Viet Bank,GP Bank, Military Bank, Ocean Bank, SHB, Bac A Bank and Tien Phong Bank.
Their move was part of commercial bank efforts toimplement Circular 30/2011/TT-NHNN issued by the State Bank ofVietnam , effective from October 1.
The State Bankregulated that non-term deposit interest rates offered by commercialbanks and other credit institutions be capped at 6 percent per year.
The cap on deposit rates for term deposits of one month or more remainsunchanged at 14 percent - or 14.5 percent at credit unions.
About 23 representatives from commercial banks participated in the meeting in Hanoi .
However, several banks said the central bank should not apply suchadministrative methods in the long-term and that Circular 30 should beonly considered a temporary solution until the market became stable.
VPBank, PG Bank, VIB and OceanBank complained about what they said was a significant decrease in deposits from customers.
Nguyen Thi Mai Huong, deputy general director of OceanBank, said thather bank witnessed a decline of 20 percent in deposits in recent days.
Duong Thu Huong, general secretary of Vietnam Banking Association, saidafter the circular became effective, all banks slashed their non-termdeposit interest rates to under 6 percent per year, saying that althoughseveral small banks had found it hard to entice customers, the marketis expected to become more healthy and transparent.
Shealso said that from the beginning of the year to September 12, thebanking sector reached a deposit growth of 10.72 percent and a creditgrowth of 8.63 percent. She described this as an optimistic signal.
Hoang Viet Trung, deputy director of the State Bank in Hanoi, said thatthe central bank was classifying banks and that weak banks will receivesupport from the SBV./.
In recent months, severalcommercial banks have flouted regulations by offering higher interest orbonus interest to entice depositors.
Some banks also gavedepositors overnight interest of 14 percent. These practices continuedto introduce a high element of risk into the nation's banking system,said the State Bank on Oct. 12.
The Oct. 12's agreementwas signed by Vietcombank, Vietinbank, Agribank, Vietnam DevelopmentBank, Techcombank, Maritime Bank, VIB, VP Bank, PG Bank, Bao Viet Bank,GP Bank, Military Bank, Ocean Bank, SHB, Bac A Bank and Tien Phong Bank.
Their move was part of commercial bank efforts toimplement Circular 30/2011/TT-NHNN issued by the State Bank ofVietnam , effective from October 1.
The State Bankregulated that non-term deposit interest rates offered by commercialbanks and other credit institutions be capped at 6 percent per year.
The cap on deposit rates for term deposits of one month or more remainsunchanged at 14 percent - or 14.5 percent at credit unions.
About 23 representatives from commercial banks participated in the meeting in Hanoi .
However, several banks said the central bank should not apply suchadministrative methods in the long-term and that Circular 30 should beonly considered a temporary solution until the market became stable.
VPBank, PG Bank, VIB and OceanBank complained about what they said was a significant decrease in deposits from customers.
Nguyen Thi Mai Huong, deputy general director of OceanBank, said thather bank witnessed a decline of 20 percent in deposits in recent days.
Duong Thu Huong, general secretary of Vietnam Banking Association, saidafter the circular became effective, all banks slashed their non-termdeposit interest rates to under 6 percent per year, saying that althoughseveral small banks had found it hard to entice customers, the marketis expected to become more healthy and transparent.
Shealso said that from the beginning of the year to September 12, thebanking sector reached a deposit growth of 10.72 percent and a creditgrowth of 8.63 percent. She described this as an optimistic signal.
Hoang Viet Trung, deputy director of the State Bank in Hanoi, said thatthe central bank was classifying banks and that weak banks will receivesupport from the SBV./.
