Vietnam Increases Treasury Deposit Inclusion in LDR Calculation to 50%

The State Bank of Vietnam has issued Decision No. 1743/QD-NHNN, increasing the inclusion rate of State Treasury's time deposits when calculating the loan-to-deposit ratio (LDR) to 50%. This is in accordance with Point a (iii), Clause 4, Article 20 of Circular No. 22/2019/TT-NHNN, as amended and supplemented by Circular No. 25/2026/TT-NHNN. Reports indicate that liquidity in the financial market is tight, making it difficult to lower interest rates. The decision to increase the treasury deposit inclusion rate is aimed at enhancing credit provision capacity. Vietnam's economy continues to maintain a positive growth trajectory. The government is committed to fostering the synchronized development of the capital market, managing credit effectively, and creating a transparent investment environment to rebuild confidence in the real estate market. The State Bank of Vietnam's move is part of its broader strategy to support economic growth by bolstering banks' funding capabilities. In Vietnam's context of a one-party system, economic development remains a paramount objective, and monetary policy is a key instrument for ensuring overall economic stability and progress. Given Vietnam's significant economic linkages with China, stabilizing the domestic financial system is also crucial for the healthy development of the regional economy. Source: Nhan Dan