The Research centre of Saigon Securities Incorporation (SSI Research) has released the report on the monetary market in the week of May 18th to 22nd. The State Bank of Vietnam did not conduct any new transaction on the Open Market Operation (OMO), while 22.997 trillion dong of bills and three billion dong of OMO were due in the week. In general, the SBV net injected 22.994 trillion dong via OMO. The abundant liquidity caused the interbank interest rates to fall continuously, reaching 0.53 percent per annum on overnight term (down by 82 basis points) and 0.73 percent per annum on one-week term (down by 76 basis points) by the end of the week. The difference between US dollar and dong interest rates narrowed from 1.2 percent to 0.4 percent per annum.
After a month of constant maturity, the value of treasury bills in circulation dropped sharply from 147 trillion dong to 38 trillion dong, equivalent to 109 trillion dong being pumped into the banking system. The interbank rates dropped continuously to the lowest zone in the past three years. The value of bills matured in the week was 11 trillion dong, lower than the previous weeks, thus, the interest rates could move sideways or inch up on the interbank market.
According to the report of the government sent to the National Assembly, as of May 15th, the credit growth was 1.32 percent compared to the end of last year, lower than the 1.42 percent recorded in the end of April, showing the limited output, although lending rates have declined by 0.5 2.5 percent per annum compared to the time before the Covid-19 pandemic.
The deposit interest rates of some joint stock commercial banks have been lowered by 30 50 basis points on terms of 12 and 13 months, and by 10 20 basis points on terms from six to less than 12 months, to balance the decline of the lending rates. Currently, the deposit rates are 3.9 4.25 percent per annum on terms of less than six months, 4.9 7.5 percent per annum on terms from six to less than 12 months, and 6.2 7.8 percent per annum on terms of 12 and 13 months.
