Four Vietnamese banks cut rates to boost economy

Wednesday, 2019-01-09 16:46:53
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Interest rates on loans to five priority sectors will be reduced.
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NDO - Four major state-owned commercial banks in Vietnam have announced that they will lower their lending rates to priority sectors in a move to support enterprises.

They are Vietcombank, BIDV, Agribank and Vietinbank, whose decision will take effect on January 10.

Agribank Chairman, Trinh Ngoc Khanh, stated that the rates on loans to agriculture, export, supporting industries, high technology and small and medium-sized businesses will be cut by 0.5 percentage points.

A similar rate cut will also be made by Vietinbank and Vietcombank, meaning the maximum lending rates will be no higher than 6% per year.

Lower interest rates are expected to eat into the banks’ profits, with Vietinbank and Vietcombank seeing their profits decrease by VND700 billion (US$30.1 million) and VND450 billion (US$19.35 million) respectively.

The earnings of Agribank are also expected to decrease by millions of US dollars.

But Vietcombank Chairman, Nghiem Xuan Thanh, stated that the rate cuts will be practical actions, reflecting Vietcombank’s commitment to proactively implement the government’s policies for the sake of overall economic development.