The amount of money people deposit into the banking system continues to set a new record.

Illustration photo (Photo: MP)

The amount of deposits from residents in Vietnamese banks is at an unprecedented high, reaching nearly VND6.84 trillion in July 2024. According to statistics from the State Bank, this amount has increased by more than VND305,000 billion compared to the end of 2023, corresponding to a growth rate of 4.68%. This figure is not only proof of the continuous increase in deposits over the past two years, but also reflects a strong shift of capital flows from investment channels considered risky such as stocks and real estate to banks. Compared to the same period last year, the amount of deposits increased by nearly VND450,000 billion, marking a record level of deposits from residents.

A notable point is that people's deposits continue to increase sharply even though the mobilization interest rate in 2023 has hit rock bottom. During this period, the interest rates of many banks have decreased sharply, with some terms only fluctuating between 1.7 - 5.2%. However, from April 2024, the mobilization interest rate at many banks has begun to show signs of increasing again. This reflects the need for banks to attract capital in the context of the economy gradually recovering and capital flows from economic organizations shifting to other investment channels.

By September 2024, many banks had adjusted their deposit interest rates, especially for short terms. Some banks such as Dong A Bank, OceanBank, Agribank , and Bac A Bank had increased their interest rates to over 6%/year for long terms. Compared to the beginning of 2024, deposit interest rates for many terms at many banks have increased from 0.5% to 1%/year, creating more attractive conditions for savers.

This slight increase in interest rates not only helps attract new deposits but also retains previously deposited funds, ensuring the stability of capital sources for banks. This also creates a big difference between investment channels at the present time.

The main reason why people prefer to deposit money in banks instead of other investment channels is because of the safety and stability that banks bring, especially in a period when the economy is still volatile. According to Mr. Phan Le Thanh Long, CEO of AFA Group, in the context of economic uncertainty, smart money will choose to return to banks to wait for better investment opportunities in the future. Mr. Long commented that although real estate has low lending interest rates, housing prices are too high and market liquidity is low, causing money to not flow into this sector.

In addition, the stock market has yet to surpass the 1,300-point threshold, making many investors hesitant. The instability of the bond market, along with violations in corporate bond issuance in the past year, has reduced people's confidence in other investment channels. In that context, saving in banks has become the most reasonable choice to preserve capital.

In the final stages of 2024, many financial experts recommend that investors should prioritize keeping a high proportion of highly liquid assets such as cash and bank deposits. AFA Capital Investment Fund recommends that, in the context of the world economy possibly entering a recession, holding cash or liquid assets helps investors easily seize opportunities when the market shows signs of recovery.

Mr. Phan Dung Khanh, Investment Consulting Director of Maybank Investment Bank, also believes that “cash is king” at the moment. Investors with cash in hand will have many advantages when negotiating, buying cheap assets, or choosing potential stocks during the stock market’s down sessions. He also emphasized that keeping cash will help investors have more choices and be more proactive in transactions.

A question that many people are asking is whether deposit interest rates will continue to increase by the end of 2024? According to experts, deposit interest rates are unlikely to decrease in the near future. One of the main reasons is the high demand for credit at the end of the year, when businesses need capital to expand production and business. In addition, the State Bank also plans to maintain interbank interest rates at a high level of 4-5%, in order to limit foreign currency hoarding and exchange rate speculation.

Securities companies such as MBS and KBSV all forecast that deposit interest rates will continue to increase by about 50 basis points in the second half of 2024. Dragon Capital Securities Company (VDSC) also expects deposit interest rates to end 2024 at a level 0.5 - 1% higher than at the beginning of the year. However, experts also note that although deposit interest rates may increase, lending interest rates will not be affected immediately due to the delay in the adjustment process between these two interest rates.

The amount of people's deposits in banks is reaching a new record, demonstrating people's confidence in this safe investment channel in the context of many risks in the real estate and stock markets. The slight increase in deposit interest rates from April 2024 further strengthens the trend of saving in banks, and many experts predict that interest rates will continue to increase by the end of the year. In the context of a volatile economy, people still choose to keep cash and deposit in banks as safe solutions, while waiting for better investment opportunities in the future.

Source: https://dangcongsan.vn/kinh-te/luong-tien-gui-cua-nguoi-dan-vao-he-thong-ngan-hang-tiep-tuc-lap-ky-luc-moi-680688.html