Last week, through the issuance of 7-day T-bills, the interest rate was only 2.75% / year, the State Bank has regularly attracted VND5,000 billion / session, particularly on Friday with VND2,000 billion. Accumulated from the beginning of 2019 until now, the State Bank net withdrew a total of VND 110,507 billion through open market operations.

The recent interest rate cut by the State Bank of 0.25 percentage points also affected, causing the interbank interest rate to fall to a deeper level.

Accordingly, interbank interest rates for all terms in the past week continued the downward trend and remained below 3% / year.

For overnight and 1 week terms, interest rates in turn decreased from 2.7% and 2.9% to 2.65% and 2.7% / year. However, for 2-week term, the interest rate increased slightly by 0.05% to 3.15% / year.

However, in the opposite direction, the interest rate in the market 1 tends to increase in many banks, except for those with less than 3-month term, some banks adjusted slightly.

Statistics of the State Bank said that deposit rates in VND are still stable at 0.5-1% / year for demand deposits and term deposits of less than 1 month; 4.5-5.5% / year for term deposits from 1 month to less than 6 months; 5.5-6.8% / year for term deposits from 6 months to less than 12 months; the term of over 12 months is at 6.6-7.3% / year.

But in fact, interest rates in the market have moved quite far from this figure. In particular, the highest interest rate with 18-month term is up to 8.7% / year (for online savings). Over 15 month period, many banks pushed interest rates to over 8% / year. For deposit certificates, there is a special interest rate bank exceeding 9% / year.

According to economic experts, the reason for the opposite movement of VND interest rates is mainly because banks continue to promote the mobilization of medium and long-term capital. Because the capital borrowed by banks is on the interbank market, although the liquidity is good, it is still mainly short-term capital, which serves as a channel to support urgent capital needs.

Meanwhile, banks are in need of medium and long-term funds to meet the regulations of the State Bank, tightening short-term capital sources for medium and long-term loans in the coming time.

Along with that, banks are also entering the year-end credit season, when businesses are in need of large capital to serve production and business needs during Tet. Therefore, raising interest rates is also a way to prepare for this seasonal demand.