Interbank interest rates and deposit rates are falling sharply

DNHN - As a result of the State Bank's announcement of a reduction in operating interest rates, interbank interest rates and deposit rates on the market plummeted, creating favorable conditions for financial activities.

The financial system's liquidity has reached a healthy level, and interest rates on the interbank market have declined significantly. As a result of the State Bank's announcement of a reduction in operating interest rates, interbank interest rates and deposit rates on the market plummeted, creating favorable conditions for financial activities.

The level of liquidity in the banking system remained stable, and activity on the open market channel diminished. The State Bank issued only 578 billion dongs on the term buying channel with a 5.0 percent interest rate to support the maturity of this channel (a total of 753 billion dongs).

Notable during the week was the maturity of up to 49,000 billion dong worth of 91-day bills. This has enabled the State Bank to inject 48,400 billion dong net into the market via the open market channel. The volume of bills circulating on this channel decreased to 41,700 billion dongs, while the volume of bills circulating on the pledge channel plummeted to only 1,400 billion dongs.

In particular, over the course of three days (22-24), the State Bank offered 10,000 billion dongs of mature bills at each session, but there was no winning volume. Nonetheless, the State Bank net injected 30 trillion dongs into the market over the course of three sessions, ensuring liquidity supply. During the first four days of the week, the State Bank injected 39 billion dongs into the market net.

Previously, beginning on February 15, the State Bank of Vietnam began issuing 91-day bills to absorb system liquidity as interbank interest rates continued to drop sharply. By mid-March, the amount of 91-day bills in circulation had reached nearly VND 110,700 billion after nearly one month of attracting liquidity.

These bills will mature between now and mid-June 2023, contributing to the improvement of the banking system's liquidity and the reduction of market interest rates, and having a positive impact alongside the reduction of the Bank's operating interest rates. Government.

According to the Analysis Department at SSI Securities Company, currency liquidity is abundant, allowing the overnight interbank interest rate to fluctuate within a narrow range (from 4.0 to 4.5 percent). and from 4.3% to 5% for terms of one month or less).

According to the interest rate survey conducted on May 26, the overnight interest rate is 4.07% annually, the 1-week interest rate is 4.15% annually, and the 1-month interest rate is 4.71% annually...

In addition, the level of market deposit interest rates continued to decline following the State Bank's drastic reduction of deposit interest rates. The reduction ranges from 20 to 50 basis points for the group of State-owned and private Joint Stock Commercial Banks with terms of less than six months.

According to the survey, however, there are still significant differences in interest rates between banks, particularly for terms longer than six months. The 12-month term interest rate is 6.8% for State-owned Joint Stock Commercial Banks, 7.2% to 7.5% for large commercial banks, and 7.8% to 7.8% for smaller commercial banks. 8.8% for the remaining commercial bank group.

PV (t/h)