|Office staff at Agribank in Ha Noi. Bank savings still remain a safe investment due to the current market turmoil. — VNS Photo Thai Ha
HA NOI (VNS) — Despite declining deposit interest rates, people see bank savings as a safe investment channel in the context of rising price pressure and market turmoil.
In the first eight months, total deposits at credit institutions grew about 10.5 per cent, although deposit interest rates fell by 2-3 percentage points.
Deposits in dong were up by about 11 per cent.
Industry insiders estimated that in the latter part of the year, deposit interest rates would not change much, but deposits might increase.
"The current interest rate is quite stable, benefiting both banks and depositors," said Vo Thi Sanh, BIDV director of managerial information and ALCO assistance.
BIDV recently slashed the rate for 3-11 month terms by an additional 0.25-0.5 percentage point and kept rates for more-than-12 month terms unchanged at 8 per cent annually in order to encourage long-term deposits.
"Let's say there is no way for people to put their money in. If somebody has idle money, they could make profits from savings," said Nguyen Thanh Toai, ACB's Deputy Director.
Some Ha Noi branches also reported good footfall for short-term deposits, which accounted for 50 per cent of the total.
"At the present time, I prefer the three-month term to longer time frames as it gives me a sense of flexibility," said Do Dang Tan, whose nine-month deposit was just due at Techcombank.
Tran Thi Dung, a customer at Vietcombank, added that he always chooses short terms because "with a big amount of money, a very slight increase or decrease in interest rates makes a big different in profit."
However, a few investors disagree.
"I know short terms are more flexible but I don't see a possibility of interest rates increasing. So I'm trying my luck with a one year term to enjoy the 8 per cent rate. In an emergency, I can always mortgage my savings to borrow money immediately," said Pham Thi Hoa, a retail investor. — VNS