Lagrange test: H o : No autocorrelation (Prob 2 > α=5%) H 1 : There is autocorrelation

White test: H o : There is no phenomenon of variance change (Prob ᵪ 2 > α=5%) H 1 : There is a phenomenon of variable variance.

**Table 4.7: Diagnostic test and residual test**

Unit: %

Variable | Accreditation | nR 2 | Prob 2 _ |

HD1M_TCV | Autocorrelation (LM Test) | 6.875648 | 0.1426 |

Variance (White Test) | 7,977393 | 0.3346 | |

HD6M_TCV | Autocorrelation (LM Test) | 2.823177 | 0.0929 |

Variance (White Test) | 9.532566 | 0.1230 | |

HD12M_TCV | Autocorrelation (LM Test) | 0.624720 | 0.4293 |

Variance (White Test) | 7,895867 | 0.2458 | |

HD18M_TCV | Autocorrelation (LM Test) | 1.414595 | 0.2343 |

Variance (White Test) | 8,363241 | 0.0791 | |

HD24M_TCV | Autocorrelation (LM Test) | 1.491429 | 0.2220 |

Variance (White Test) | 6.609193 | 0.1580 | |

CVNH_TCV | Autocorrelation (LM Test) | 0.006167 | 0.9969 |

Variance (White Test) | 60.72642 | 0.2464 | |

CVTDH_TCV | Autocorrelation (LM Test) | 3.359875 | 1.1864 |

Variance (White Test) | 27.31280 | 0.8199 | |

Contract 1M_TCCK | Autocorrelation (LM Test) | 5.631849 | 0.2284 |

Variance (White Test) | 14.62938 | 0.0511 | |

Contract6M_TCCK | Autocorrelation (LM Test) | 2.408945 | 0.1206 |

Variance (White Test) | 14.79667 | 0.0522 | |

Contract 12M_TCCK | Autocorrelation (LM Test) | 0.305679 | 0.5803 |

Variance (White Test) | 0.787132 | 0.8525 | |

Contract18M_TCK | Autocorrelation (LM Test) | 3.356877 | 0.0669 |

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Variance (White Test) | 6.291303 | 0.0983 | |

Contract24M_TCCK | Autocorrelation (LM Test) | 3.478041 | 0.0622 |

Variance (White Test) | 4.13170 | 0.2495 | |

CVNH_TCK | Autocorrelation (LM Test) | 2.02462 | 0.1121 |

Variance (White Test) | 16,99773 | 0.0574 | |

CVTDH_TCK | Autocorrelation (LM Test) | 0.51142 | 0.2780 |

Variance (White Test) | 15.56967 | 0.0563 |

(Source: Appendix 08) The residuals of the model do not have autocorrelation and variable variance, so the model is reliable.

**4.5.4 Choosing the optimal lag for the variables in the model Table 4.8: Optimal latency testing**

Unit: month

ARDL (y, TCV) | y:HD1M | y:HD6M | y:HD12M | y:HD18M | y:HĐ24M | y:CVNH | y:CVDDH |

Optimal latency | (4,2) | (1,1) | (1,4) | (1,2) | (1,2) | (2,6) | (2,4) |

R 2 | 0.9676 | 0.9480 | 0.96345 | 0.93368 | 0.9336 | 0.9774 | 0.9715 |

ARDL (y, stock market) | y:HD1M | y:HD6M | y:HD12M | y:HD18M | y:HĐ24M | y:CVNH | y:CVDDH |

Optimal latency | (4,2) | (1,1) | (1,1) | (1,1) | (1,1) | (3,3) | (2,3) |

R 2 | 0.9651 | 0.94047 | 0.93873 | 0.91398 | 0.9135 | 0.9661 | 0.96231 |

(Source: Appendix 04) The optimal lag of the ARDL model (TCV, CVNH) is ARDL (2.6) with R 2 of 0.97747, that is, the model explains more than 97% of the volatility of interest short-term lending rate at the refinancing rate. The optimal latency of the ARDL(TCV, HD1M) model is (4,2), ARDL(TCV, HD6M) is (1,1), ARDL(TCV, HD12M) is (1,4), ARDL(TCV, HD18M) is (1,2), ARDL(TCV, HD24M) is (1,2), ARDL(TCV, CVTDH) is (2,4).

Similarly, the optimal lag of the ARDL(TCK, CVNH) model is (3,3) with an R 2 of 0.96618, that is, the model explains more than 96% of fluctuations in short-term lending rates. at the discount rate. The optimal delay of the ARDL(TCK, HD1M) model is (1,1),

ARDL(TCK, HD6M) is (1,1), ARDL(TCK, HD12M) is (1,1), ARDL(TCK, HD18M) is (1,1), ARDL(TCV, HD24M) is (1,1 ), ARDL(TCV, CVTDH) is (2,3).

**4.6 Research results**

**4.6.1 Transmission from refinancing rate to deposit and lending rates at Bank for Agriculture and Rural Development of Vietnam**

**Table 4.9: Long-term interest rate pass-through from refinancing rates to deposit and lending rates at Agribank in the period 2008-2015**

Unit: %

TCV | 1 month contract | Contract 6M | Contract 12M | Contract 18M | HD24M | CVNH | CVTDH |

Slope | 0.1052 | 0.1913 | 0.6142 | 0.26757 | 0.27187 | 0.7133 | 0.6210 |

(Source: Appendix 05) The pass-through coefficients are positive and significant at the 5% level, implying a positive relationship between the variables in the long run, i.e. when the refinancing rate increases or decreases deposit interest rate or lending interest rate also increase or decrease. In the long term, the pass-through from refinancing interest rates is incomplete and quite high in the relationships between HD12M_TCV, CVNH_TCV, CVTDH_TCV. Specifically:

- For 12-month deposit rates in relation to refinancing rates: The pass-through of refinancing rates is 0.614213, which means that in the long run when refinancing rates increase (or decrease), ) 1% will increase (or decrease) the deposit interest rate for 12 months by 0.614213%.

- Similarly, the pass-through of the refinancing interest rate to the deposit interest rates of HD1M, HD6M, HD18M, and HD24M is 0.10526, respectively; 0.19134; 0.26757; 0.27187. Systems

This number is quite low, showing that the pass-through from refinancing rate to deposit rates for 1-month, 6-month, 18-month and 24-month terms is quite low in the long term.

- For short-term, medium-term and long-term lending rates in relation to refinance rates: The pass-through of refinancing rates is 0.7133 and 0.6210, respectively, meaning that in the long-run when interest is If the refinancing rate increases (or decreases) by 1%, it will affect the interest rate for loans of credit institutions and credit institutions to increase (or decrease) by 0.71335%; 0.6210%.

**Table 4.10: Short-term pass-through from refinancing rates to deposit and lending rates at Agribank for the period 2008-2015**

Unit: %

Variable | o | δ | Mal=(βo-1)/δ |

HD1M_TCV | 0.463933 | -0.051617 | 10,385 |

HD6M_TCV | 0.693945 | -0.061132 | 5.006 |

HD12M_TCV | 0.479081 | -0.156341 | 3.332 |

HD18M_TCV | 0.446020 | -0.112841 | 4,909 |

HD24M_TCV | 0.445094 | -0.119060 | 4.661 |

CVNH_TCV | 0.505428 | -0.122802 | 4.027 |

CVTDH_TCV | 0.470750 | -0.133025 | 3,979 |

(Source: Appendix 06) The short-term interest rate pass-through βo ranges from about 0.45% - 0.69%. The correction coefficient δ has a negative sign and is significant at the 5% level. Specifically: βo of contract 6M_TCV is equal to 0.693945 representing the short-term pass-through from refinancing interest rate to 6-month deposit rate of 69.3945% and δ = - 0.061132 indicates deposit interest rate. 6 months from the long-term equilibrium position when there is a change in the refinancing interest rate, the 6M deposit rate will adjust by about 6,1132% so that the next period 6M deposit rate will return to the equilibrium position. and this took a period of 5,006 months. The same explanation for the short-run pass-through of the remaining variables of the model.

**4.6.2 Transmission from discount rate to deposit rate and lending rate at Bank for Agriculture and Rural Development of Vietnam**

**Table 4.11: Long-term pass-through from rediscount rates to deposit and lending rates at Agribank in the period 2008-2015**

Unit: %

TCK | 1 month contract | Contract 6M | Contract 12M | Contract 18M | HD24M | CVNH | CVTDH |

Slope | 0.2770 | 0.1213 | 0.6256 | 0.47707 | 0.3228 | 0.7868 | 0.75382 |

(Source: Appendix 05)

The pass-through coefficients have a positive value and are significant at the 5% level, implying a positive relationship between the variables in the long run, that is, when the discount rate increases or decreases, the deposit rate or loans also increase or decrease. In the long term, the pass-through from the rediscount rate is incomplete and quite high in the relationships between contract 12M_TCK, CVNH_TCK, CVTDH_TCK. Specifically:

- For the 12-month deposit rate in relation to the rediscount rate: The pass-through of the rediscount rate is 0.6256, which means that in the long run when the rediscount rate increases (or decreases), ) 1% will increase (or decrease) the deposit interest rate of 12 months by 0.6256%.

- Similar to the pass-through rate of the rediscount interest rate to the deposit interest rates of HD1M, HD6M, HD18M, and HD24M, respectively, 0.27708; 0.12130; 0.47707; 0.3228. The coefficients

This low level shows that the pass-through from the discount rate to the deposit rate for 1-month, 6-month, 18-month, and 24-month terms is quite low in the long term.

- For short-term, medium-term and long-term lending rates in relation to the rediscount rate: The pass-through of the rediscount rate is 0.78685; 0.753829 means that in the long term, when the rediscount interest rate increases (or decreases) by 1%, it will affect the lending interest rate of CVNH, CVTDH increase (or decrease) by 0.78685%; 0.753829%.

**Table 4.12: Short-term pass-through from discount rate to deposit and lending rates at Agribank in the period 2008-2015**

Unit: %

Variable | o | δ | Mal=(βo-1)/δ |

Contract 1M_TCCK | 0.406666 | -0.057590 | 10,303 |

Contract6M_TCCK | 0.551751 | -0.053415 | 8,392 |

Contract 12M_TCCK | 0.657086 | -0.104424 | 3.284 |

Contract18M_TCK | 0.477074 | -0.099772 | 5.241 |

Contract24M_TCCK | 0.474035 | -0.104549 | 5.031 |

CVNH_TCK | 0.597473 | -0.225497 | 1,785 |

CVTDH_TCK | 0.450366 | -0.236571 | 2.323 |

(Source: Appendix 06) The short-term interest rate pass-through βo ranges from about 0.45% - 0.69%. The correction coefficient δ has a negative sign and is significant at the 5% level. Specifically: βo of contract 12M_TCK is equal to 0.657086, representing the short-term pass-through from refinancing interest rate to 12-month deposit rate of 65.7086% and δ = - 0.104424 indicating deposit interest rate. 12 months deviating from the long-term equilibrium position when there is a change in the rediscount rate, the 12M deposit rate will adjust by 0.104424% so that the next period 12M deposit rate will return to the equilibrium position. and this took a period of 3,284 months. The same explanation for the short-run pass-through of the remaining variables of the model.

**4.6.3 Asymmetry in interest rate pass-through**

**Table 4.13: Transmission asymmetry test**

Unit: %

βo | 1 _ | 2 _ | MAL + | MAL - | Wald 1 = 2 _ | |

HD1M_TCV | 0.466418 | -0.84487 | -1.10536 | 0.6315 | 0.4827 | 1 # δ 2 |

HD6M_TCV | 0.670697 | -0.93216 | -1.05611 | 0.3533 | 0.3118 | 1 # δ 2 |

HD12M_TCV | 0.436557 | -0.79436 | -1.10604 | 0.7093 | 0.5094 | 1 # δ 2 |

HD18M_TCV | 0.409006 | -0.82944 | -1.13500 | 0.7125 | 0.5207 | 1 # δ 2 |

HD24M_TCV | 0.426518 | -0.93404 | -1.15802 | 0.6140 | 0.4952 | 1 # δ 2 |

CVNH_TCV | 0.464695 | -0.89256 | -1.08786 | 0.5997 | 0.4921 | 1 # δ 2 |

CVTDH_TCV | 0.480824 | -0.48045 | -1.10303 | 1.081 | 0.4707 | 1 # δ 2 |

Contract 1M_TCCK | 0.401107 | -0.84677 | -1.09040 | 0.7073 | 0.5492 | 1 # δ 2 |

Contract6M_TCCK | 0.552356 | -0.93357 | -1.07589 | 0.4795 | 0.4161 | 1 # δ 2 |

Contract 12M_TCCK | 0.616985 | -0.90939 | -1.05204 | 0.4212 | 0.3641 | 1 # δ 2 |

Contract18M_TCK | 0.445718 | -0.93064 | -1.07744 | 0.5956 | 0.5144 | 1 # δ 2 |

Contract24M_TCCK | 0.440508 | -0.93254 | -1.07726 | 0.5600 | 0.5216 | 1 # δ 2 |

CVNH_TCK | 0.546253 | -0.74245 | -1.26875 | 0.6111 | 0.3576 | 1 # δ 2 |

CVTDH_TCK | 0.321751 | -0.73367, | -1.28087 | 0.9245 | 0.5295 | 1 # δ 2 |

(Source: Appendix 07) δ 1 , δ 2 have negative values, so they are significant and have statistical value at 5% level. Specifically: βo of contract 1M_TCV equals 0.466418 representing the short-term pass-through from refinancing interest rate to 1-month deposit rate of 46,6428% and δ 1 = - 0.84487 indicates deposit interest rate. 1 month higher than the long-term equilibrium interest rate, when there is a change in the refinancing interest rate, the 1M deposit rate will adjust about 0.84487% so that the 1M deposit rate will return to the equilibrium position in the next period. and this takes a period of 0.6315 months. δ 2 = -1,10536 indicates that the 1-month deposit interest rate is lower than the balance interest rate long-term equilibrium when there is a change in the refinancing interest rate, the 1M deposit rate will adjust about 1,10536% so that the next period 1M deposit rate returns to the equilibrium position and this takes time. is 0.4827 months. The same explanation for the short-run pass-through of the remaining variables of the model. A different value of δ 1 than δ 2 shows that interest rate pass-through is different when interest rates are above equilibrium and below equilibrium, or in other words, short-run interest rate pass-through is asymmetric.

**4.7 Discussing the research results on the current situation of pass-through from the State Bank's interest rate policy to deposit and lending rates at Bank for Agriculture and Rural Development of Vietnam**

- There is a pass-through from the refinancing rate to Agribank's deposit and lending rates.

- Long term:

+ The pass-through from the refinancing rate to the 12-month deposit rate is the strongest. The reason for this is that 12-month term deposits accounted for a relatively high proportion of Agribank's mobilized capital structure and in the 2009-2014 period, the SBV's operating interest rates fluctuated strongly, so Agribank also actively adjusted promptly adjust interest rates in accordance with the regulations of the State Bank and ensure the interests of customers as well as the bank in a timely and prompt manner, meeting the needs of customers.

liquidity in each period. Therefore, the 12-month deposit rate is quite sensitive to the fluctuation of the refinancing interest rate.

+ The level of pass-through from refinancing interest rates to short-term lending rates and medium and long-term lending rates is high because Agribank actively adjusts interest rates to ensure liquidity and balance short-term funding. and medium and long term.

Thus, in the long run, the pass-through of refinancing rates to long-term deposit rates is higher than that of short-term deposit rates. This is consistent with the expectation hypothesis of interest rate term structure. Short-term interest rates have a higher correlation than long-term interest rates and are susceptible to strong fluctuations by market factors. Long-term interest rates are affected not only by current short-term rates, but also by future short-term rates. In the long run, the pass-through from refinancing rates to lending rates is higher than the pass-through to deposit rates, showing that this result is consistent with the study of Kleimeier, Sander [2005]. .

- In the short term, the pass-through of refinancing rates to deposit and lending rates is almost the same and not too high. The reason for this is that when the SBV's operating interest rate changes, the bank has an expectation that this change is only temporary, so the bank does not adjust interest rates immediately to avoid an immediate cost increase. . Short-run interest rate pass-through is asymmetric and this result is consistent with the work of Hannan and Berger (1991), Neumark and Sharpe (1992), Scholnick (1996), Lim (2001), Jamilov et al. 2015).

- There is a pass-through from the rediscount rate to Agribank's deposit and lending rates.

- Long term:

+ The pass-through from the rediscount rate to the 12-month deposit rate is the strongest.

+ The pass-through from rediscount interest rates to short-term lending rates and medium and long-term lending rates are both high. The reason is that in 2011, inflation increased, deposit and lending interest rates of Agribank increased, leading to difficulties for banks.

the business and the liquidity situation of the bank was difficult. The State Bank of Vietnam issued Circulars 19/2012/TT-NHNN and 20/2012/TT-NHNN in which the VND lending interest rate for 4 priority areas is 13%/year to help businesses and households overcome difficulties and stabilize production and business. Due to the interest rate policy requirements of the State Bank, Agribank had to change interest rates in a timely manner, especially lending rates to boost the economy. Therefore, lending interest rates must be low corresponding to lower operating rates, so the pass-through to lending rates is higher than deposit rates.

Thus, in the long run, the pass-through of rediscount interest rates to long-term deposit rates is higher than that of short-term deposit rates.

- In the short term, the pass-through of the discount rate to the deposit and lending rates is almost the same, not too high, and the short-term pass-through is asymmetric. The reason for this is because:

+ Agribank has always faced slow increase in lending interest rates and slow lowering of deposit rates to meet the SBV's operating interest rates, both to increase profits for the bank itself in a short time, and to reduce risks. Liquidity.

+ Agribank does not want to change deposit or lending rates if changes in the SBV's refinancing or rediscount rates are small or temporary. The reason is due to the appearance of adjustment costs related to interest rate changes such as advertising, printing, notice... Therefore, Agribank will react slowly to temporary changes in monetary policy and react quickly to long-term changes in monetary policy.

+ Customers do not like to switch financial products because they spend a lot of time, effort and inconvenience to find other better financial products. Therefore, Agribank adjusted to increase deposit rates faster and reduce lending rates more slowly to retain customers while still generating profits, so there was asymmetry in the rate of interest rate transmission.

**Conclusion Chapter 4**

Chapter 4 presents the theory of ARDL research model, the transmission results from refinancing interest rate, rediscount interest rate to deposit interest rate, lending interest rate at different maturities at Agribank in the period of 2008 -2015. The results show that the pass-through is not complete in the long and short term, only 12-month deposit rates, short-term, medium- and long-term lending rates have high pass-through when there is a change in interest rates. financing, discount rate. At the same time, there is asymmetric pass-through of interest rates in the short-run study. The results of this study are the basis to find out the factors affecting the asymmetric transmission of the SBV's operating interest rates or the rigidity of Agribank's interest rate adjustment.

**CHAPTER 5. CONCLUSIONS AND SOLUTIONS ON INTEREST RATE MANAGEMENT OF BANK FOR AGRICULTURE AND RURAL DEVELOPMENT OF VIETNAM.**

**Chapter 5 Introduction**

Chapter 5 presents the main results drawn from the empirical studies in chapter 4, thereby suggesting the operating policy of the State Bank, and providing solutions for operating the interest rate policy of the Bank for Agriculture and Development. rural development to increase interest rate pass-through.

**5.1 Conclusion**

The research results on the transmission from the refinancing interest rate, the SBV's rediscount interest rate to the deposit interest rate and lending interest rate at Agribank in the period 2008-2015 are as follows:

- There is a close relationship between the refinancing interest rate, the SBV's rediscount interest rate and the deposit interest rate and lending interest rate in terms of Agribank and this relationship changes in the same direction. When the refinancing and rediscount interest rates increase (decrease), the deposit and lending rates also increase or decrease.

- The transmission from SBV's refinancing rate to Agribank's deposit and lending rates is incomplete. This is because when there is an adjustment of the refinancing interest rate, the deposit and lending rates at Agribank need time to adjust to fully reflect the change, called the lag. In the long run, the pass-through from refinancing rates to lending rates is higher than the pass-through to deposit rates. This suggests that interest rate pass-through is faster in the lending market when policy interest rate changes are correctly predicted, whereas in the deposit market the pass-through is weaker. In the short term, the pass-through of refinancing rates to deposit and lending rates is almost the same, not too high and asymmetrical.

- The transmission from SBV's rediscount rate to Agribank's deposit and lending rates is incomplete. In the long run, the pass-through from the discount rate to the lending rate is higher than the pass-through to the deposit rate. In the short term, the pass-through of the discount rate to the deposit and lending rates is almost the same and is not too high. The speed of adjusting interest rates to the equilibrium position in the long-term is quite fast, ranging from 1 to 2 months, while that of deposit rates is quite slow.

**5.2 Interest rate management policy of the State Bank**

Based on the assessment of developments and forecasts on the domestic and international macroeconomics and currency, and closely followed the Resolutions of the National Assembly and the Government, the State Bank continued to be consistent with the goal of controlling inflation (below). 5%), stabilizing the macro-economy, supporting reasonable economic growth (about 6.7%), ensuring system safety.

To achieve the above goal, management solutions will be focused by the State Bank on the following areas:

- Strengthen coordination with other macro policies, especially fiscal policy to be proactive and timely in operating monetary policy.

- Implement well the information and communication about monetary policy management solutions and the current status of banking operations.

- Implement credit solutions to control credit size in line with directional targets, continue to follow the motto of credit expansion in parallel with safety and efficiency, ensure system safety and promote promote reasonable economic growth.

- Continue to focus credit capital on production and business fields, especially priority areas according to the Government's policy.

The management of interest rates needs to be in harmony with inflation, macroeconomic situation, money market movements, foreign exchange and balance of interests between banks - depositors - borrowers. Therefore, in the coming time, the State Bank will control interest rates proactively and flexibly to regulate market interest rates at a reasonable level, contributing to stabilizing the money market and banking activities.

**5.3 Solutions on interest rate management of Bank for Agriculture and Rural Development of Vietnam**

**5.3.1 Always monitor and forecast the movements of the SBV's interest rate policy**

- Due to the transmission from the SBV's operating interest rate to Agribank's deposit and lending rates, Agribank must always monitor and forecast the movements of the SBV's interest rate policy, especially the manage the refinancing and rediscount interest rates of the State Bank for timely and flexible calculation and adjustment in deposit and lending rates.

- Enhance coordination in providing information to the State Bank as a basis for improving the coordination efficiency of monetary policy and other macro policies in order to limit the negative effects caused by crowd psychology that disturbs the money market.

**5.3.2 Accurate calculation of the lag of the SBV's adjustment of operating interest rates**

Because the transmission from SBV's operating interest rate to Agribank's deposit and lending rates always takes a certain amount of time, which is called the lag. Therefore, Agribank needs to accurately calculate this lag in order to adjust deposit and lending rates at the right time to increase interest rate pass-through.

**5.3.3 Take advantage of the mobilization channel from the rediscount of valuable papers**

- The transmission from refinancing interest rate, rediscount interest rate to deposit rate and lending interest rate in the short term is the same and not too high. Therefore, short-term deposit interest rates and short-term lending rates do not fluctuate much when the operating interest rate of the State Bank changes. This shows that Agribank is focusing on mobilizing capital from residents and businesses but has not taken advantage of the mobilization channel from rediscounting valuable papers. Therefore, Agribank needs to take advantage of the mobilization channel from rediscounting valuable papers. At the same time, Agribank needs to come up with a flexible interest rate policy in line with business strategy orientations and market interest rate movements in each period.

- Develop a diversified capital mobilization mechanism on the basis of calculation so that the mobilized capital source has the lowest cost in order to lower the output lending interest rate, increase competition in the market, and help credit growth.

- Agribank should establish a balanced and appropriate capital structure to help Agribank balance capital between loan sources and ensure good liquidity.

**5.3.4 Diversify the structure of short-term mobilized capital**

- In order to increase the pass-through to short-term deposit interest rates, reduce costs, and create initiative in capital and liquidity, Agribank needs to diversify the structure of short-term deposits by researching and presenting capital mobilization products specific to agriculture, rural areas and farmers.

- Researching the market, segmenting customers to offer products suitable for each customer, each region, developing preferential interest rate policies, diversifying and perfecting the product portfolio system. raise capital, increase utility for deposit products, cross-sell products...

**5.3.5 Develop reasonable and flexible medium and long-term lending interest rate policy**

- The pass-through from the refinancing rate, the rediscount rate to the medium and long-term lending rate is quite high, showing that the medium and long-term lending rates are more volatile when there is a change from the SBV's operating interest rate. . Therefore, Agribank needs to develop a reasonable and flexible medium and long-term lending interest rate policy to best meet the loan needs of individuals and businesses.

- Always closely monitor the evolution of refinancing interest rates and rediscount rates of the State Bank in order to timely adjust medium and long-term lending rates, avoiding temporary fluctuations that cause damage to borrowers.

**5.3.6 Expanding customers of all economic sectors**

- In order to increase the pass-through of interest rates to lending rates, helping to improve the balance between deposit rates and lending rates, Agribank needs to focus on expanding customers from all economic sectors on the basis of selecting carefully select customers, accurately analyze the production and business situation and financial capacity of customers. Effectively implementing customer classification and loan evaluation, Agribank will

have specific credit policies applied to each suitable customer.

- Diversifying loan products and services, diversifying borrowers by expanding lending to economic sectors outside the state, small and medium enterprises, individuals, households and businesses. businesses... resolutely restrict lending to inefficient state-owned enterprises and real estate enterprises. Loan portfolio diversification associated with portfolio diversification reduces the risk for the bank itself.

**5.4 Support solutions**

In order for Agribank's solutions to be effective and effective, it is necessary to have supportive solutions from the State Bank and the Government.

**5.4.1 Solutions from the State Bank**

5.4.1.1 Interest rate policy

The SBV should keep the operating interest rate stable so that lending rates are not too high, helping the economy recover and develop. However, deposit interest rates must still be attractive enough to depositors and banks can better mobilize capital for growth. In addition, the SBV needs to manage and take measures against the motives and actions of raising interest rates that are not healthy, causing psychological instability.

5.4.1.2 The State Bank needs to make reasonable adjustments in the trio: compulsory reserve instrument, rediscount interest rate and open market operations to stabilize the market.

The SBV needs to use the reserve requirement with caution because of its strong impact on the market - changing the amount of money supply in circulation. At the same time, the SBV needs to flexibly and effectively use the tool of refinancing interest rate and rediscount interest rate by determining the size of the total discount limit and the total funding limit close to market demand. combined with the use of open market tools to influence to keep the interbank market interest rates fluctuating within the rediscount interest rate and refinancing rate bracket.

5.4.1.3 Improve information system to support monetary policy planning and implementation

The explosion of modern banking services such as credit cards, ATM cash machines... has had a significant impact on the implementation of monetary policy, making money demand.