Under pressure from the mandated loan-to-deposit ratio (LDR), the State Bank of Vietnam (SBV) might have to raise the deposit interest rate cap by 50 basis points in 2026, analysts say.
In a recent report on the outlook for bank interest rates in 2026, analysts from VPBank Securities Company predicted that the SBV will likely continue to prioritise maintaining low interest rates.
However, pressure from the mandated LDR capped at 85 per cent could force the SBV to raise the deposit interest rate ceiling by 25 basis points in Q2 2026.
After the first adjustment, the analysts forecast another 25 basis point increase in deposit interest rates about one to two months later, bringing the total expected increase in 2026 to 50 basis points.
According to the analysts, given that forecasts for credit growth in 2026 are similar to this year's rate of 18-20 per cent, the adjustment to the deposit interest rate cap in 2026 will likely be modest compared to previous adjustment cycles.
In fact, in 2025, banks had to compete with gold to attract idle money. However, the Government’s recent decision to abolish the State monopoly mechanism to increase the gold supply in 2026 will help alleviate this pressure.
The analysts cited a precedent in the past in which the deposit interest rate ceiling was adjusted without accompanying changes in the refinancing interest rate and vice versa.
However, as the SBV has recently focused more on managing the USD/VNĐ exchange rate within a narrow range, the refinancing interest rate is forecast to converge with the deposit interest rate ceiling in 2026, implying a 75 basis point increase in the second quarter of 2026.
The refinancing rate and the deposit interest rate cap represent the upper limit of the benchmark interest rates managed by the SBV.
In the past five years, only one period of interest rate increases at this upper limit has been recorded, but that was a very strong adjustment, with benchmark interest rates rising by 200 basis points in just one month, from September to October 2022.
Meanwhile, analysts from Vietcap Securities Company expect the current pressure to increase deposit interest rates will be under control. They believe that the SBV will maintain a loose monetary policy stance to support the Government's 10 per cent GDP growth target in 2026.
Over the past two years, the SBV has flexibly used the open market operations channel to support the liquidity of the banking system. The central bank implemented a foreign exchange swap earlier this month as another intervention measure to support short-term liquidity in the banking system.
In parallel with the SBV, the State Treasury of Vietnam also significantly increased its deposits at State-owned banks to support their capital.
Other factors will also support liquidity and capital in the banking system, including further interest rate cuts by the US Federal Reserve, an accelerated disbursement of public investment capital, and a rising inflow of bank deposits from business households when they adapt to new tax and electronic invoicing regulations.
