Banking & Finance

According to the Viet Dragon Securities Corporation (VDSC), interest rates on bank deposits have increased only slightly, by 30-50 per cent, which is not considered high, while the stock market is still gloomy, which together with large payouts have led most insurance companies to forecast negative profit growth in 2022.

Under pressure from credit growth and inflation, bank deposit rates have increased since the beginning of this month. The highest rate was 7.6 per cent per annum. Experts predict that the deposit rate at many banks will be much higher this year than in 2021.

In order to support businesses and individuals, the Ministry of Finance (MoF) has proposed reducing land and water surface rentals by 30 per cent this year, costing VND3.5 trillion ($152.7 million). It is also drafting a Decree on extending the deadline for paying value added taxes, corporate income taxes, and personal income taxes. The total amount of taxes and land and water surface rentals to be extended or reduced will be around VND137 trillion ($5.9 billion).

According to the Ministry of Finance, State budget revenue reached VND460.6 trillion ($17.68 billion) in the first quarter of this year and State budget expenditure VND351.3 trillion ($15.3 billion), for a surplus of VND109.3 trillion ($4.75 billion). Despite being “abundant”, the slow pace of budget spending on development investment is a “bottleneck” for economic recovery.

Only VND3.5 trillion ($153.2 million) worth of corporate bonds were issued in March, up slightly against February but down 85 per cent year-on-year. Real estate continued to lead, with nearly half of the issuance volume, followed by securities and banking. Nearly VND29.4 trillion ($1.3 billion) worth of corporate bonds were issued in the first quarter of the year.

According to the Vietnam Banks Association, non-cash payments are increasing and the QR code channel is posting the strongest growth, of up to 200 per cent, followed by payment via mobile phone. Banks want to allow non-authenticated payments on small items to further promote digital payments.