Vietnam asks major banks to reduce costs, lower interest rates

The central bank said in a weekly review Friday that interest rates remain stable.

The State Bank of Vietnam has ordered five major banks in the country to cut costs by 5 to 10 percent so that they can bring interest rates down, news website VnExpress reported Thursday.

Agribank, BIDV, MHB, Vietcombank and Vietinbank have been asked to submit their plans and targets for reducing costs to both the central bank and the Ministry of Finance. Management of the banks will be reviewed at the end of the year based on how well the targets have been achieved, the report said.

Four of the banks, except MHB, are considered the top state-run commercial banks in Vietnam. Agribank is fully owned by the state.

The central bank said in a weekly review Friday that interest rates remain stable, ranging from 13.5 percent for the agricultural sector to as high as 25 percent for non-production companies.

Vietnam cut its interest rates earlier this month to support economic growth, reducing the repurchase rate by 1 percentage point to 13 percent and the refinancing rate by the same amount to 14 percent.

Thanh Nien News