Vietnam seeks cheaper bank loans as funding pressures persist
The central bank wants priority-sector lending rates lowered by 1.5 to two percentage points, with several state-owned lenders announcing reductions.
Vietnam’s banks face renewed official pressure to reduce borrowing costs. An October 18 directive from the State Bank of Vietnam sought cuts of 1.5 to two percentage points on loans to priority-sector businesses, alongside lower rates for depositors.
For deposits held for six months or longer, the requested reduction is at least 0.5 percentage point. The central bank also warned against competition for deposits that could threaten financial and monetary security. The move followed an October 15 Communist Party directive signed by General Secretary and President To Lam urging cheaper business credit.
Among state-owned lenders, BIDV introduced preferential loans carrying annual rates from 6 per cent. Vietcombank promised lending-rate reductions of at least two percentage points until year-end. Eligible Agribank borrowers were offered cuts reaching two percentage points from October 19.
Funding costs remain high. SSI Research’s October 12 outlook estimated that state-owned banks paid about 8.3 per cent on deposits. Its estimates for leading private lenders ranged from 8.8 to 9.4 per cent, while smaller banks paid as much as 9.8 to 10 per cent.
Official statistics put economic expansion above 9 per cent for the first nine months of 2026. The government’s annual growth target averages around 10 per cent through the end of 2030. HSC chief market strategist Tyler Manh Dung Nguyen cautioned that selective loan discounts should not be taken as evidence of a wider easing cycle, saying underlying funding pressures remained.
