The State Bank of Vietnam (SBV) slashed interest rates for the second time since September.

Non-term deposit annual interest rate was reduced from 1.0 percent to 0.8 percent; under-6-month deposit from 5.5 percent to 5.0 percent.

Under the SBV's Decision 2416, the annual interest rate was slashed by half a percentage point to 6.0 percent for borrowers in priority sectors such as agriculture, export and supporting industries as well as hi-tech firms and small-to-medium-sized enterprises.

In response to the SBV's cut, commercial banks have adjusted their own rates.

Vietcombank announced on November 18 it has cut interest rates by half a percentage point for business borrowers of Vietnamese dong for the last two months of the year. The cut would also apply to all loans taken out since November 1. 

For borrowers in priority sectors, Vietcombank’s ceiling interest rate was reduced to 5.0 percent. This is the third time the bank has cut interest rate for priority sector businesses this year. Each time the rate was slashed by half a percentage point for a total of 1.5 percent rate cut.

VietinBank slashed interest rates on deposits by 0.2 percent to 4.3-4.8 percent annually for 1-3 month and 5.3 percent for 6-9 month deposits.

Several other commercial banks also cut 0.1-0.3 percentage point for longer-term deposits over 12 months.