On Wednesday the State Bank of Vietnam both bought VND 5,671.97 worth of treasuries from five local banks and sold another VND 5,500 billion to five Vietnamese banks. It’s not clear what the thinking is behind this but as far as keeping the exchange rate where it is, these two transactions cancel each other out.
Furthermore, the bank is charging interest of 4 percent on the treasuries it has sold but is receiving only 3.49 percent on the treasuries it has bought. What’s more, is that the interbank interest rate is now at 4.94 percent.
Normally banks would just lend to each other and in this context, it looks like there may be problems accessing funds from other banks for at least some of Vietnam’s banks. That said, it’s really not clear what is going on here.
