Vietnam's State Bank to raise interest rate
27/6/2008 17:34
The State Bank of Vietnam (SBV) has decided to raise the interest rate on
compulsory bonds sold to commercial banks to 13 percent from 7.8 percent,
according to its website today.
The move will help commercial banks get more
money to cover high costs of capital mobilization, said experts.
The
benchmark interest rate for Vietnamese dong was raised to 14 percent earlier
this month and one-year deposit rate in most commercial now stood at between 18
percent and 19 percent.
The new rate proves to more truly reflected the
prevailing interest rates on the monetary market, said experts.
To implement
the tightened monetary policy, SBV, or the central bank in March issued
compulsory bonds worth US$1.26 billion at the interest rate of 7.8 percent to
commercial banks, in an attempt to withdraw money from circulation.
The
issuance in one way helped curb inflation, but it also put great difficulty in
the commercial bank's capital mobilization. Many Vietnamese companies are
complaining now it is hard to get loans and they have to postpone their
projects.
The new interest rate will be paid from July 1 until they mature,
according to the central bank.
Xinhua
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