So far, two banks, Agribank and MB, have confirmed interest rate cuts for both new loans and existing debts. However, the potential for further rate reductions varies significantly among banks due to differences in capital costs and net interest margins (NIM).
Many businesses have reported receiving loan interest rate reductions ranging from 0.5 to 1.5 percentage points, saving them hundreds of millions of VND each month.
At the end of October, Viet Phat Steel Joint Stock Company received notifications of loan interest rate reductions from several banks. According to Ms. Pham Thi Hai, the company's Chief Financial Officer, the reduction is approximately 1.5 percentage points, bringing the interest rate down to 6.1% per annum, nearly equivalent to the 2025 level. Ms. Hai stated that the new interest rate helps the company save hundreds of millions of VND each month.
Interest rate reduction during peak production season
"The savings from loan interest costs will be reinvested to purchase raw materials for production and business activities. Additionally, with the year-end and Tet (Lunar New Year) approaching, these savings also provide the company with additional resources to pay employees," Ms. Hai shared.
According to her, the steel industry has faced many challenges in the domestic market this year, especially in the northern region. However, thanks to export orders, the company expects the volume of orders to continue increasing in the last months of the year.
At Austdoor Group Joint Stock Company, Ms. Tran Phuong Linh, Head of Finance, reported that the company also received notifications of interest rate reductions from banks, with reductions ranging from 0.5 to 1.5 percentage points.
"Year-end is the peak season for completing construction projects. The company requires a large amount of capital and must quickly rotate it to purchase raw materials, meet project deadlines, and prepare for reinvestment in the new year," Ms. Linh said.
Austdoor's capital rotation needs typically range from VND300 to 400 billion per month, but can increase to VND500 to 600 billion during the peak construction season at the end of the year. This is when the company needs a large amount of capital to complete projects, pay for input materials, and prepare resources for the following year, according to Ms. Linh.
"The interest rate reduction has a very positive impact, helping us stabilize input capital costs, laying the groundwork to maintain stable output prices. As a result, customers also benefit as they do not have to bear the pressure of price increases," Ms. Linh stated.
Austdoor expects to grow by approximately 35% in 2026 and aims for similar or even higher growth in 2027, if interest rates continue to decrease or remain stable at current levels.
Potential for interest rate reduction varies by capital costs and net interest margins
According to VnEconomy, by the end of October 2026, at least 22 commercial banks had announced loan interest rate reductions, with common reductions ranging from 1.5 to 2 percentage points per annum. Among them, 15 banks offered preferential credit packages with a total limit of over VND451 trillion (more than $17.55 billion).
These programs mainly focus on short-term loans under six months for production and business purposes. Most incentives apply to new disbursements rather than automatically adjusting interest rates for existing debts.
In this context, Mr. Le Quoc Minh, Deputy General Director of MB, stated that the bank proactively implements the Government and State Bank's directives on reducing loan interest rates for individual and business customers in five priority sectors according to the Government's orientation.
Notably, MB applies interest rate reductions to both new and existing loans.
"For existing loans, when it comes time to adjust interest rates, MB will proactively reduce the rates, and customers do not need to perform additional administrative procedures," Mr. Minh stated.
According to Mr. Minh, by the end of October, after the reduction, MB's average short-term loan interest rate was around 8-9% per annum, while the medium-term loan interest rate was 9-10% per annum.
According to VPBank Securities Company (VPBankS), expanding interest rate reductions to existing debts will significantly increase the policy's impact compared to programs that only apply to new disbursements.
However, reducing interest rates for existing loans also puts pressure on banks' net interest margins (NIM). Analysts suggest that this pressure may emerge as early as the fourth quarter of 2026 due to a sharp decline in loan interest rates, while capital mobilization costs have not decreased correspondingly.
This pressure is not evenly distributed among bank groups. According to FiinRatings data released on October 30, the state-owned commercial banks (Big 4) had an average net interest margin (NIM) of 2.8% in the first half of 2026, with a capital cost of 3.5%. The four largest joint-stock commercial banks, including ACB, MB, Techcombank, and VPBank, had the highest NIM at 3.9%, with a capital cost of 4.3%. Meanwhile, the remaining joint-stock commercial banks had the lowest NIM at only 2.4%, but the highest capital cost, up to 5.3%.
For banks with high capital costs but low net interest margins, reducing loan interest rates will be more challenging, especially when the reduction is applied to existing debts.
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