Measures must be taken to bring down bank interest rates, said the State Bank of Vietnam (SBV) at a meeting with CEOs from 26 commercial banks in the country on May 25.
In an earlier development, the SBV issued directives to reduce the policy interest rate by 0.5%, from a previous 5.5% to 5% a year, as well as the overnight interest rate in interbank electronic payment and compensatory lending interbank from 6% to 5.5% a year. In addition, the refinancing interest rate was also adjusted by half a percentage point, from 5.5% to 5% a year.
In another directive, the SBV has instructed commercial banks to allow restructuring repayment and maintain debt groups to support borrowers and businesses.
Failure to comply with the directives in a timely manner will result in severe penalties, according to the SBV. Banks were also told to minimise inconveniences and facilitate problem-solving to support customers.
In an earlier meeting with commercial banks and governmental agencies, Deputy Prime Minister Le Minh Khai stressed the importance of continuing with cost-cutting measures, reducing deposit rates, promoting economic development and granting businesses easier access to funds.
"Establishing a reasonable and sustainable deposit rate is crucial to our efforts to adjust lending rates," he said.
Businesses and banks must realise they are in this together. Banks will go well when businesses do well, he added.
He said top priorities for the SBV in the near future include the management of credit growth, interest rates, exchange rates and connectivity in the banking sector. Stronger efforts are also required to improve the sector's transparency, the business environment, the macroeconomy, exchange rates and the stability of the commercial banking system.
Khai urged the SBV, governmental ministries and commercial banks to provide timely information to the public and take additional steps to handle cases of harassment, corruption and group interests.