Vietnam Banking Sector Sees Coordinated Deposit Rate Cuts, Lending Rates to Follow

Overview

More than 20 Vietnamese commercial banks have simultaneously reduced deposit interest rates, a move coordinated with the State Bank of Vietnam (SBV) and aimed at lowering overall market interest rates. This signals an impending reduction in lending rates to support businesses and individuals, with early adopters like Agribank and Nam A Bank already implementing cuts.

Key Facts

• Over 20 domestic commercial banks have adjusted deposit rates downward following an SBV meeting on April 9.
• Agribank reduced both deposit and lending rates by 0.5% per annum, using its 24-month savings rate as a reference for medium- and long-term loans.
• Nam A Bank cut lending rates for individual customers by up to 3.0% per annum while reducing deposit rates by 0.5% for terms of 6 months or more.
• Sacombank reduced both deposit and lending rates by 0.5% per annum across multiple terms.
• KienlongBank lowered lending rates by up to 1.0% per annum for both individual and corporate clients, prioritizing manufacturing and import-export sectors.
• The rate cuts follow a deposit rate competition that began in late 2025 and Q1 2026.
• Some banks still maintain deposit rates above 8.5%, with market participants watching for further moves.

What Happened

According to information from the State Bank of Vietnam, more than 20 domestic commercial banks have adjusted deposit interest rates downward. The banks include major state-owned institutions like BIDV (BID), Vietcombank (VCB), VietinBank (CTG), and Agribank (AGR), along with private banks such as Techcombank (TCB), OCB (OCB), VPBank (VPB), and MB Bank (MBB). This coordinated action follows a meeting with the SBV on April 9, reflecting alignment with government and central bank policy to lower market interest rates and support affordable credit access for households and businesses.

Agribank has taken a leading role by not only cutting deposit rates but also reducing lending rates. The bank uses its 24-month savings rate as a benchmark for medium- and long-term loans, meaning a 0.5% deposit rate reduction translates directly to a 0.5% lending rate cut. Nam A Bank announced lending rate reductions of up to 3.0% per annum for individual customers while lowering deposit rates by 0.5%. Other banks like Sacombank and KienlongBank have implemented similar dual reductions, with KienlongBank focusing on supporting production and export-import sectors.

Market Context

The banking sector (HOSE, HNX, UPCOM) has been under pressure from high deposit rates since late 2025, with recent trading showing mixed reactions. On April 14, BID closed flat at VND 40,000 with volume of 5.14 million shares, while VCB gained 0.34% to VND 59,000 and TCB rose 0.63% to VND 32,000. OCB saw a more pronounced move, closing up 1.75% to VND 12,000 on April 10 with volume of 2.34 million shares. The coordinated rate cuts may alleviate margin pressure that has weighed on bank profitability during the deposit competition phase.

Strategic Significance

The coordinated rate reduction represents a strategic shift from competitive deposit gathering to aligned monetary policy execution. For long-term investors, this signals reduced funding cost volatility and potentially stabilized net interest margins if lending rates follow proportionally. The SBV’s visible coordination suggests a policy priority on stimulating credit growth to support economic recovery, which could translate to higher loan volume despite lower rates, particularly for banks with strong corporate lending franchises like BID and VCB.

What to Watch

• Q2 2026 earnings reports from major banks (BID, VCB, TCB, CTG) for net interest margin impact.
• Broader implementation of lending rate cuts beyond early adopters like Agribank and Nam A Bank.
• SBV’s next monetary policy meeting and any official guidance on benchmark rates.
• Credit growth data for April-May 2026 to gauge stimulus effectiveness.
• Actions from banks still maintaining deposit rates above 8.5% (specific names not disclosed in article).