Vietnamese banks told to cut loan interest rates

The State Bank of Vietnam (SBV) has directed banks to continually reduce input costs with an aim to cut loan interest rates. In a document issued by central bank governor Nguyen Thi Hong, banks have been required to cut operating costs and unnecessary expenses, as well as administrative procedures, so as to have room for lending interest rate reduction to support the economic recovery and development. Banks have been also instructed to continually promote the implementation of the Government’s interest rate support programme for loans of enterprises, cooperatives, and business households. The SBV will monitor banks, which continue to raise interest rates, and take measures to deal with the violation cases. The Vietnam Bankers Association (VNBA) called on its members to keep deposit interest rates at 9.5% or below to reduce lending interest and boost economic recovery.