September 14, 2017 / 3:34 AM / 10 months ago

Vietnam's gov asks banks to stop breaking foreign currency deposit limits

HANOI, Sept 14 (Reuters) - Vietnam’s central bank governor asked banks to stop breaking foreign currency deposit limits, a central banks statement on Thursday said.

“Governor demands banks to tightly control credit growth in foreign currency....not implementing technical methods to break the ceiling limit for deposit rates, strictly prohibit unhealthy competition in raising capital,” according to a statement by the State Bank of Vietnam (SBV).

Vietnam in 2015 scrapped the interest rate ceiling on dollar deposits for organisations and companies, and lowered the ceiling for dollar deposits by individuals to 0.25 percent, from 0.75 percent previously, to prevent hoarding of dollars.

The statement did not say how banks are breaking the ceiling.

Banks violating the rule might be prevented from opening new branches, representative offices or new service lines, the statement said.

Reporting by Mai Nguyen; Editing by Shri Navaratnam

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