The Governor of the State Bank of Vietnam, Pham Duc Anh, addressed the challenges of reducing interest rates during a recent meeting with the business community. He explained that the current high demand for capital, coupled with limited funding availability, has forced interest rates to remain elevated. As a result, both deposit and lending rates have increased, which directly affects businesses involved in production and trade.

According to the State Bank's statistics, as of June 26, the total credit outstanding in the banking system reached over 19.97 million billion VND, marking a 7.4% increase compared to the end of 2025 and an 18% rise year-on-year. The State Bank has been actively managing interest rates to alleviate capital pressure, while banks have been advised not to compete aggressively for deposits to maintain reasonable lending rates.

Furthermore, the State Bank is considering measures to facilitate foreign currency loans for specific cases, especially for imports that support investment. Currently, short-term funding constitutes about 80% of bank capital, leaving only 20% for medium to long-term loans. However, there is a significant demand for long-term borrowing among businesses.

In response to these challenges, the State Bank is exploring policies that would allow commercial banks to manage assets for issuing corporate bonds, which could provide an additional funding channel for businesses. This initiative is part of a broader strategy to enhance the capital market and reduce the reliance on short-term funding.

The Governor emphasized the importance of maintaining financial stability while supporting businesses, ensuring that credit institutions manage their risks effectively. The ongoing discussions with the Ministry of Finance aim to align funding strategies with the economic needs of the country.