Interest rates are at rock bottom. Which bank should I deposit money in to get interest rates above 6%/year?

2 banks increase interest rates

In October, 25 banks reduced deposit interest rates, of which 10 banks adjusted twice. VietBank, Viet A Bank, and Bac A Bank reduced up to 3 times.

On the contrary, two banks increased their rates: GPBank and MSB. Notably, MSB increased by 0.7 percentage points for terms of 15 months or more, all at 6.2%/year.

After 2 adjustments, LPBank has the largest decrease, up to 1.2%/year for 6-month term, 1.1%/year for 9-month term and 0.8%/year for 12-month term.

Coming in second are Dong A Bank and Nam A Bank. Interest rates for 6-month and 9-month deposits at these two banks both decreased by 0.7%/year. For 12-month deposits, Dong A Bank decreased by 0.7%/year, Nam A Bank decreased by 0.6%/year.

Next, banks also reduced interest rates on 6-9 month term deposits by 0.6%/year, including Bac A Bank, NCB, CBBank, VietBank, and Viet A Bank.

The above banks are also among the group with the strongest interest rate reductions for 12-month terms, with a reduction of 0.5 - 0.6%/year.

Meanwhile, Agribank , Eximbank, OCB, KienLongBank or OceanBank did not adjust deposit interest rates throughout October. Even MSB, one of the two banks that just increased deposit interest rates for 15-36 month terms, also kept the interest rates for 1-13 month terms unchanged throughout the past month.

October also witnessed a number of banks lowering deposit interest rates for many terms to below 6%/year.

Currently, only PVCombank maintains an interest rate of 6%/year for deposits with terms of less than 12 months.

By the end of October, only 6 banks maintained 6%/year for 12-month term, including CBBank, Viet A Bank, PVCombank, BaoVietBank, Sacombank and OceanBank.

In which, the highest interest rate for this term is 6.2%/year (PVCombank and Sacombank).

For 18-month term deposits, 18 banks maintain interest rates of 6%/year or higher. Of which, the highest interest rate is 6.5%/year (HDBank and PVCombank).

DEPOSITS INTEREST RATE DEVELOPMENTS IN OCTOBER IN ORDER OF MAJOR DECREASES (%/year)
BANK	6-MONTH TERM		9-MONTH TERM		12-MONTH TERM
BANK	October 31	Compared to September 30	October 31	Compared to September 30	October 31	Compared to September 30
LPBANK	5.1	-1.2	5.2	-1.1	5.6	-0.8
DONG A BANK	5.5	-0.7	5.6	-0.7	5.85	-0.7
NAMA BANK	4.9	-0.7	5.2	-0.7	5.7	-0.6
BAC A BANK	5.6	-0.6	5.7	-0.55	5.8	-0.5
NCB	5.7	-0.6	5.75	-0.6	5.9	-0.5
CBBANK	5.7	-0.6	6.4	-0.6	6	-0.6
VIETBANK	5.4	-0.6	5.5	-0.6	5.8	-0.5
VIET A BANK	5.6	-0.5	5.6	-0.6	6	-0.5
SAIGONBANK	5.2	-0.5	5.4	-0.3	5.6	-0.3
PG BANK	5.1	-0.5	5.3	-0.3	5.4	-0.3
SCB	5.35	-0.4	5.45	-0.4	5.65	-0.4
TPBANK	5	-0.4	5	-0.6	5.55	-0.15
SEABANK	4.8	-0.4	4.95	-0.4	5.1	-0.4
VIETCOMBANK	4.1	-0.4	4.1	-0.4	5.1	-0.4
HDBANK	5.7	-0.4	5.5	-0.6	5.9	-0.4
VIB	5.2	-0.4	5.2	-0.4
PVCOMBANK	6.1	-0.3	6.1	-0.3	6.2	-0.3
BAOVIETBANK	5.8	-0.3	5.9	-0.4	6.1	-0.4
SHB	5.4	-0.3	5.6	-0.2	5.8	-0.3
ACB	5	-0.3	5.1	-0.2	5.5	0
BVBANK	5.55	-0.2	5.65	-0.25	5.75	-0.3
SACOMBANK	5.3	-0.2	5.6	-0.2	6.2	0
VPBANK	5	-0.2	5	-0.2	5.3	-0.2
TECHCOMBANK	4.95	-0.2	5	-0.2	5.35	-0.1
BIDV	4.4	-0.2	4.4	-0.2	5.3	-0.2
MB	5.1	-0.1	5.2	-0.1	5.4	-0.2
VIETINBANK	4.6	-0.1	4.6	-0.1	5.3	-0.2
OCEANBANK	5.8	0	5.9	0	6.1	0
KIENLONGBANK	5.4	0	5.6	0	5.7	0
OCB	5.3	0	5.4	0	5.5	0
EXIMBANK	5.2	0	5.5	0	5.6	0
MSB	5	0	5.4	0	5.5	0
ABBANK	4.9	0	4.9	0	4.7	0
AGRIBANK	4.7	0	4.7	0	5.5	0
GPBANK	5.45	+0.3	5.55	+0.3	5.65	+0.3

Where will interest rates go in November?

Interest rates seem to have bottomed out after the number of banks decreased as well as the decrease in October was the lowest in the past 3 months. Deposit interest rates even showed signs of increasing in some terms such as at GPBank and MSB.

In September, the market recorded 33 banks reducing interest rates. Of these, 12 banks reduced their rates twice, two banks reduced their rates three times and one bank reduced their rates four times.

In August, 34 banks reduced their deposit interest rates. Of these, 9 banks reduced their rates twice, 3 banks reduced their rates three times, 4 banks reduced their rates four times, 2 banks reduced their rates five times, and Eximbank alone reduced their rates six times.

It is likely that banks will no longer compete to reduce deposit interest rates this November because liquidity is no longer as abundant as before due to seasonal factors.

Especially when the State Bank continuously absorbs net through the issuance of treasury bills. In the past week alone, the operator continued to issue treasury bills with the volume gradually increasing towards the end of the week in the context of stable system liquidity.

At the end of the week, VND25,500 billion worth of 28-day term bills were additionally issued at an interest rate of 1.45% (unchanged from the end of last week).

With 73,800 billion VND maturing, the total volume of outstanding treasury bills decreased to 193,300 billion VND from 241,000 billion VND.

This week will record an additional 46,900 billion VND of maturing treasury bills.

As for interbank interest rates, overnight rates rose to 2.8% in the trading session last Wednesday and cooled down to 1.6% at the end of last week.

Source