The analysis team of Saigon Securities Incorporation Research (SSI Research) has released a report for the week of May 4th 8th. In the week, the State Bank of Vietnam (SBV) did not make new transactions on the Open Market Operation (OMO), while nearly 36 trillion dong of bills and 1.05 billion dong of OMO matured.
In general, the SBV net injected 35.997 trillion dong via OMO. The liquidity of banks was abundant, and interbank interest rates fell fairly sharply, reaching 1.88 percent per annum on overnight term (down by 37 basis points) and 2.1 percent per annum on one-week term (down by 35 basis points). The difference between dong and US dollar interest rates on the interbank market narrowed from two percent to 1.7 percent per annum.
Nearly 147 trillion dong of bills issued in the first three months of the year started to mature from the second half of April. The outstanding balance continuously dropped, currently reaching 86 trillion dong.
About 25 trillion dong of bills will due this week, and interbank interest rates are expected to continue to fall.
SSI Research recorded an increase of 10 30 basis points in deposit rates for terms of six months or more at some commercial banks with small market share, while the rates almost stayed the same at other banks. As of May 8th, commercial banks have restructured debt repayment terms for 130 trillion dong of outstanding loans, exempted or reduced interest rates (by 0.5 2.5%) for 1,000 trillion dong of existing outstanding loans and 630 trillion dong of new disbursement. To support commercial banks, the SBV is considering further reducing operating rates in order to lower capital costs for commercial banks.
