Balancing funding and stabilizing interest rates in Vietnam's banking sector

Banks need to balance capital, ensure liquidity and the ability to meet obligations, while avoiding disruptions to market-wide interest-rate levels.

Interest rates remain high

After raising the real deposit rate to as high as 7.9% per year in March 2026, Viet Nam International Bank (VIB) adjusted rates down by 0.3–0.4 percentage points on April 2. For deposits of 1 billion to 5 billion VND, rates fell to 7.5% per year; for deposits above 5 billion VND, rates were 7.6% per year.

Vietnam Joint Stock Commercial Bank for Industry and Trade (VietBank) deposit rates for short-term maturities of 1 to 5 months are capped at 4.75% per year in line with SBV regulations. For longer terms, rates remained higher, including around 7.5% per year for 6-month terms and up to 7.8% per year for 12-month terms.

On April 2, Mr. Nguyen Van Hoang in Ho Chi Minh City said he contacted a commercial bank to check savings rates; staff quoted 7% per year, lower than a few days earlier. However, some banks offer promotions that bring rates to roughly 8.8–9% per year.

In its latest deposit rate schedule, Cake by VPBank (Cake) applies 7.7% per year for 6–9 months, rising to 7.9% per year for 10 months or longer. Since the start of April, the bank has introduced promotional programs that add to the base rate. Customers depositing from 5 million VND for 6–13 months with no early withdrawal receive an extra 1 percentage point. First-time savers can receive up to an additional 1.3 percentage points for terms of 6 months or longer, paid at the end of the term. As a result, Cake’s maximum rate can reach 9.2% per year.

Sacombank offers 8.2% for 15 months, 8.6% for 24 months, and 8.8% for 36 months. The program runs until June 30 or until the target is reached, aiming to mobilize stable medium- to long-term funds to support lending activities.

Must manage capital well

Since the beginning of the year, deposit rates have risen sharply. In March 2026, many banks adjusted rates 4–5 times, pushing six-month deposit rates up to 9% per year.

On March 30, SBV issued a directive requiring banks to comply with deposit rate regulations, strengthen monitoring and discipline, promptly handle violations, ensure liquidity, and support credit growth in manufacturing and other sectors while maintaining bank safety.

Banks are expected to balance capital use, ensure liquidity and repayment capacity, avoid disrupting market-wide interest-rate levels, direct credit toward production and business, priority sectors and growth engines, and ensure the safety of credit institutions.

A few days after the directive, the rate environment remained high. In MBS’s March market update, a survey indicated that actual deposit rates were higher than the posted rates on bank websites, reflecting funding pressures, particularly around quarter-end.

Among 16 banks tracked by MBS, most raised deposit rates—mainly for terms of 6 months and longer—by 0.1 to 1.4 percentage points. The trend extended to both large banks and banks including Vietcombank, BIDV, Agribank and VietinBank. By end-March 2026, the highest 12-month rate reached 8.7% per year, while the average 12-month market rate rose to about 8.07% per year.

A deputy general director at a city bank said loan growth outpaced deposits, leading banks to raise input costs to attract idle funds.

According to SBV, as of March 23, credit outstanding across the system rose about 2.02% year-on-year. In Ho Chi Minh City and Dong Nai, SBV branch data showed deposits of credit institutions increased only 0.46% by March 31, while credit growth reached 1.5% from year-end.

Mr. Michael Kokalari, Director of Macroeconomic Analysis and Market Research at VinaCapital, said Vietnam’s rate environment has faced significant pressure since 2025 due to liquidity tensions in the banking system, with credit growth outpacing deposit growth by up to 5 percentage points.

He also noted that an oil price shock has continued to push 12-month deposit rates above 8% at many banks. Higher oil prices could widen the balance of payments (BoP) deficit and increase depreciation pressure on the VND, narrowing the central bank’s room to ease monetary policy to support the economy.

According to Mr. Nguyen Duc Len, Deputy Director of SBV’s Ho Chi Minh City branch, maintaining stable interest rates supports macro stability, helps control inflation, and supports sustainable growth. To achieve this, banks need to improve capital management, allocate capital efficiently, and focus credit growth on productive sectors and growth drivers.

Debt restructuring and forbearance

To support enterprises, the Private Sector Development Research Board (Ban IV) recommends that the Prime Minister rapidly implement measures for credit support, debt restructuring, interest-rate relief, and cash-flow improvement. Proposed measures may include subsidized interest rates, extending debt tenors, debt rescheduling, broader access to short-term credit, and expedited tax refunds to create liquidity for enterprises to maintain operations.

Policy should be implemented soon, particularly for industries heavily affected, including manufacturing, export activities, agriculture, and SMEs.