Idle cash streams into banks after Tet

The State Bank of Vietnam (SBV) in Ho Chi Minh City has reported that 12 joint stock commercial banks in the city have attracted a large amount of idle cash from residents after Tet holidays.

Customers deposit their money at HDBank (Photo: SGGP)

These 12 banks received up to VND13.5 trillion (US$632.19 billion) of deposited money within only a week after Tet. Their total deposit amount has reached VND785 trillion (US$36.76 billion) as of February.

The number of depositors has strongly increased recently at banks in the city.

Nguyen Hanh from District 3 said that she had the habit of depositing her family’s savings in banks after Tet holidays in the hopes of a prosperous and lucky year.

Minh Tri from District 7 who was sending VND30 million (US$1,404) in his Asia Commercial Bank account said that was a present from his children and grandchildren in the Tet holidays.

Deputy Director of individual customer division at Housing Development Bank Huynh Trung Minh said that banks have usually launched promotional programs to attract as many as depositors.

Phan Dinh Tue, deputy director of Saigon Thuong Tin Commercial Joint Stock Bank said they have mobilized over VND6.5 trillion (US$304.39 million) in the first two months this year.

According to Mr. Tue, deposit amount usually surge after the Lunar New Year Festival when many families have built up a large amount of cash from Tet bonuses and savings.

He forecast that residents would continue depositing their idle cash in banks this year because it is safer and more convenient than other investment channels.

Real estate market has gradually warmed up but not prospered, yet. Investment in the stock market is risky and just for experienced investors. Gold and foreign currency markets have been kept stable with low profitability, he analyzed.

Representative from SBV's Monetary Statistics and Forecast Department said that the capital mobilization ability of credit institutions has been stronger although last year the State Bank had cut deposit interest rate by 1.5-2 percent against the previous yearend.

The rate is expected to be stable or slightly reduced this year. However deposit amount at banks will continue rising because it is a safe and effective investment channel amid low inflation rate, he predicted.

By Nhung Nguyen – Translated by Hai Mien

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