A transaction at ABBank (Photo: VietnamPlus)

Local banks have raised their interest rates in a move to attract depositors and increase their medium- and long-term capital.

The interest rates of many banks have been adjusted up 0.7-0.8 percent per year in recent days. According to experts, in addition to banks’ need for money to meet lending demand, the rates often hike during the year-end.Race becomes fiercer The Saigon – Hanoi Commercial Joint Stock Bank (SHB) has just posted its highest interest rate at 8.2 percent per year, applied for all 13-month deposits. The rate has also been raised from 7 percent to 7.8 percent for six-month term, 8 percent for nine-month term, and 8.1 percent for 12-month term. Earlier, the highest annual interest rate was 7.2 percent.

VietCapitalBank has just officially announced the issuance of CDs for individual and institutional customers with interest rates of up to 10.2 percent per year.pressure is making deposit interest rates high and even higher in the coming time. As the capital demand of businesses and business households sharply increases during the year-end period, banks need to increase the mobilisation of capital to meet credit growth.

(Illustrative photo: VietnamPlus)

Will lending interest rates decrease?

Since the beginning of August, four large banks – Vietcombank, Agribank, BIDV and VietinBank and two joint stock banks – VPBank and Techcombank, have been pioneering in cutting lending rates in priority areas by 0.5-1 percent to 5.5-7.5 percent per year for short-term loans. However, with deposit rates rising in recent days, experts believe the expectation that some large banks will reduce lending rates for other banks to follow is hardly to come.medium- and long-term capital by raising interest rates. When the banks raise interest rates, it will affect the interest rate level of the whole system.