Vietnam Deposit Rate Outlook: Stabilization Expected After SBV Meeting

Overview

Deposit rates in Vietnam are expected to stabilize and gradually decline following the State Bank of Vietnam’s (SBV) meeting in early April 2026, according to a new report from credit rating firm S&I (SNI) and commentary from banking executives. However, high credit growth, tight liquidity, and competition from alternative investment channels are limiting the pace of reduction. The outlook directly affects major banks including VPBank (VPB) and Vietcombank (VCB).

Key Facts

• SNI’s report highlights that deposit rate increases and tight liquidity were the top concerns at annual general meetings of Vietnamese banks.
• VPBank CEO Nguyen Duc Vinh stated that high deposit rates in Q1 2026 were due to tight market liquidity and high credit growth.
• Vinh expects deposit rates to remain elevated through Q2 2026 and possibly into early Q3 2026 before gradually declining.
• VPBank has already reduced deposit rates for some tenors and plans further cuts depending on market conditions.
• VNBA Deputy Chairman Nguyen Quoc Hung noted that banks face competition for idle cash from gold, stocks, and real estate, limiting the ability to cut deposit rates deeply.
• Vietcombank Securities (VCBS) forecasts deposit rates will stabilize and not increase further due to SBV’s directive, but pressure from medium- and long-term capital demand persists.
• Credit growth has outpaced deposit growth for an extended period, putting upward pressure on funding costs.

What Happened

A new report from SNI, a Vietnamese credit rating firm, summarized key takeaways from the 2026 annual general meeting season for commercial banks. The report identified rising deposit rates and tightening liquidity as the most significant concerns discussed by shareholders and management. According to SNI, while there were expectations that deposit rates would cool after the SBV governor’s meeting with banks in early April 2026, funding pressure remains high, limiting the possibility of sharp rate cuts in the short term.

VPBank CEO Nguyen Duc Vinh told shareholders that the high deposit rates seen in Q1 2026 were primarily due to tight market liquidity and strong credit growth. He noted that new regulations, including reserve requirement ratios, also contributed. Vinh predicted that the high-rate environment would persist for some time, possibly through Q2 and into early Q3 2026, before gradually easing. He added that VPBank has already reduced rates on some tenors and will continue to adjust based on market conditions.

Market Context

VPB (listed on HOSE) closed at VND 27,000 on April 15, 2026, unchanged from the previous session, with volume of 9.5 million shares. VCB (also on HOSE) closed at VND 60,000, up 1.01%, with volume of 8.5 million shares. The banking sector has been under pressure from rising funding costs and margin compression, though expectations of rate stabilization may provide some support. The broader market has been sensitive to monetary policy signals, with the SBV’s directive to keep rates stable being a key factor for investor sentiment.

Strategic Significance

The deposit rate outlook is critical for bank net interest margins (NIMs). If rates stabilize and eventually decline, banks like VPB and VCB could see relief on funding costs, potentially improving profitability. However, the pace of reduction is constrained by strong credit demand and competition for deposits from other asset classes. The SBV’s ability to manage liquidity and guide rates lower without triggering capital outflows will be a key test. For long-term investors, the trajectory of deposit rates will influence earnings forecasts and valuation multiples for the banking sector.

What to Watch

• SBV’s next monetary policy meeting and any further guidance on rates or reserve requirements.
• Q2 2026 earnings reports from VPB and VCB, particularly NIM trends and deposit growth.
• Credit growth data for the banking sector, especially if it continues to outpace deposit growth.
• Any changes in deposit rates announced by major banks, especially VPBank’s adjustments.
• Competition from alternative investments (gold, stocks, real estate) and its impact on deposit inflows.