Credit Institutions Urged to Cut Lending Rates by 1-2%

The State Bank of Viet Nam (SBV) asked all credit institutions including foreign bank branches to reduce lending annual interest rate by 1-2 percent in a bid to facilitate credit access and spur growth.

The central bank called on credit institutions to channel capital into traditional growth drivers, emerging industries, green transformation, circular economy, and social housing.

Credit institutions need to strictly control credit in potentially risky sectors to ensure safe and effective credit operations.

Viet Nam's interest rates have dropped strongly recently, creating a gap between the US dollar and Vietnamese dong interest rates in the interbank market, putting upward pressure on the US dollar.

Operating rates were cut four times in 2024, providing room for reducing deposit and lending rates.

As of the end of February, deposit rates average 3.3 per cent per year, 0.2 per cent lower than the end of 2023, and lending rates average 6.3 per cent, 0.7 per cent lower.

Việt Nam targets to achieve a credit growth rate of 15 percent this year.

Source: VGP