The truth is when people put less money in banks
The deposit flow of people in the banking system decreased for the first time after more than two years of continuous increase.
According to State Bank data updated by the end of January 2024, people depositing money at the bank reached about 6.5 million billion VND. This level decreased by nearly 35,000 billion compared to the beginning of the year, equivalent to more than 0.5%.
Previously, from the end of 2021, this cash flow continuously increased, on average over 50,000 billion VND per month. With new data from the operator, residential deposits decreased for the first time in more than two years.
Similarly, businesses and organizations also reduced their deposits in banks, at 6.67 million billion as of the end of January. This level is 165,000 billion VND less than at the beginning of the year, or a decrease of over 2.4%.
Meanwhile, according to data from the General Statistics Office as of March 25, capital mobilization (including residents and organizations) of credit institutions decreased by 0.76% compared to the beginning of the year, while in the same period last year. increased nearly 1.2%.
Thus, after a period of massive deposits, cash flow into the banking system has shifted in response to a prolonged low interest rate environment. The deposit interest rate at most banks is no more than 5% per year. For short-term deposits of a few months, interest rates fluctuate at 2-4% per year, the lowest level in many years.
On the other hand, people's investment appetite also changes somewhat in the context of financial market fluctuations. They choose the channel with a better profit rate to "make money". For example, from the beginning of the year until now, gold has returned 14.8-22.3%, better than stocks and savings, 12.8% and 1.2% respectively.
In this context, to retain depositors, many banks are preparing to increase deposit interest rates, instead of decreasing them as before. Thanks to that, the liquidity of the banking system is abundant in the context of credit growth being more limited than every year.
