Putting Money in a Vietnamese bank

[confusedasheck 21]

Last time I was in VN, the interest rates for VN dong denominated accounts fluctuated between 9% and 12%. US Dollar denominated accounts remained constant at 2%. That is still more than I'm getting in the US.

I'm wondering if it's worth setting up an account there. The government there is still questionable and getting money out of Vietnam does come to mind, but it's an attractive interest rate.

Anybody have any thoughts?

[JimVaPhuong 4,863]

Last time I was in VN, the interest rates for VN dong denominated accounts fluctuated between 9% and 12%. US Dollar denominated accounts remained constant at 2%. That is still more than I'm getting in the US.

I'm wondering if it's worth setting up an account there. The government there is still questionable and getting money out of Vietnam does come to mind, but it's an attractive interest rate.

Anybody have any thoughts?

If I had a bunch of money that I wanted access to while I was in VN then I'd put it in a bank there, but not because I thought it was a good investment. I just think it's better than having a wad of cash in your pocket and getting thumped on the head.

[Anh map 2,098]

Jim's idea makes the most sense. Not easy to transfer money out of VN.

[AnhDoiEm 9]

if I were you open the account, but dont put alot in, just enough to spending while you over there. otherwise what if they claim bankrupt then you be doom. GL

[ScottThuy 140]

IMO it depends on the bank... there are some great banks there...

[AnhDoiEm 9]

that is true depends where you go........but in fact some people put money in wrong bank, means they go bankruptcy, then you will lost all you put in and you will never get it back:

[JimVaPhuong 4,863]

that is true depends where you go........but in fact some people put money in wrong bank, means they go bankruptcy, then you will lost all you put in and you will never get it back:

Yeah, I've heard that. I don't know if Asian banks have the same sort of safeguards that US banks have for depositors. US banks have FDIC insurance to protect depositor accounts. I do know that a lot of Asians have a strong distrust of banks, and refuse to use them even here in the US. They keep their cash in a safe or lockbox in their house. Other Asians are well aware of this, so home invasion robberies have become pretty common. I didn't have any trouble convincing my wife to use a bank. She feels a lot more comfortable knowing that nobody can come into our house and steal all of our money.

If you want access to a limited amount of money in VN then you don't need to use a VN bank. Most US bank ATM cards will work there. There's just a limit to how much you can withdraw a day. The last time I was there the limit varied between 4 and 5 million VN dong per day.

On a related note, why do VK continue to use the word "dong" in the US when they're talking about an amount of money in dollars? For example, I hear my wife tell her sister she spent "muoi hai dong" for a $12 shirt. When we were in Vietnam she usually said "do la".

[Dan_P 5]

Can you access banks like HSBC same as in the states? If so, I wonder if you could put money into a US HSBC account and withdraw from Vietnam?

[ScottThuy 140]

Can you access banks like HSBC same as in the states? If so, I wonder if you could put money into a US HSBC account and withdraw from Vietnam?

yes you can

[confusedasheck 21]

It's not about access to money while in VN that I'm looking for. It's more for investment purposes. The 9%-12% interest rate for VN dong or 2% interest for US Dollars is somewhat attractive right now. I'm also thinking of sending some money to my girl to put in the bank and use the interest for living expenses while she's in Vietnam. But the whole Vietnam being financially unstable kinda turns me off.

[Dan_P 5]

Another thing to consider is identify theft protection. I had my credit card number stolen and someone bought something. Called up the bank and they issued me a full credit. US law requires that the maximum you have to pay on a stolen credit card is $50,though most banks waive this. I do not know what the laws are in Vietnam regarding identity theft, but if I were to put a large sum ot money into a bank, that I would find out it's policies clearly.

[AnhDoiEm 9]

for the MONEY in my safe at my house in the ground is the safe place to put it...........J/K,, if I were you, need to find out see if they have FDIC insurance in their policies, before you even proceed the process. Otherwise you will have a big lost, I'm that boat before, therefore I dont event put alot money in VN bank.

[vyx 1]

It's not about access to money while in VN that I'm looking for. It's more for investment purposes. The 9%-12% interest rate for VN dong or 2% interest for US Dollars is somewhat attractive right now. I'm also thinking of sending some money to my girl to put in the bank and use the interest for living expenses while she's in Vietnam. But the whole Vietnam being financially unstable kinda turns me off.

Have you look at mutual funds/index funds in the US? In my opinion, it's way better than putting money in a bank just to get 2%. That is barely cover inflation. What is inflation in the US now? 3.5% or so? As others people said it before, with Vietnamese bank, I don't think they're FDIC insured. Even with that 12-14% interested rate with VND, It looks attractive and all but have you seen Vietnam's inflation? By the time you're going to withdraw your money and exchange it back to USD......there isn't much left . I don't know what Vietnam future would be like, but later on, it'll cost 1,000,000 VND just to buy a sandwich.

Heck, buy some gold, we've been using gold as currency more than 2,000 years ago. It will never go away.

Edited July 6, 2012 by vyx

[quann 26]

you gotta put like at least 10k+ right? sounds like a bad idea. even the moderately wealthy people don't put their money in the bank.

and i think "dong" is commonly used as a unit of measurement for money. in vn hardly anyone uses the word dong to discuss vn currency anymore. you'll only get the number...hai tram ngan (200k), ba trieu (3 mil) etc, the "dong" part is not necessary. vk uses "do la" to not confuse their vn counterpart when talking about money.

Edited July 6, 2012 by quann

[aaron2020 11,651]

Why would you want to do this?

Invest in Altria (symbol MO), the owner of Phillip Morris. The stock pays a qualified dividend of 5%.

The qualified dividend is taxed at a top rate of 15% by the US federal government. this would leave you with an after-tax return of 4.25%.

The interest earned in Vietnam will be taxed there and here. The US government tax interests at a top rate of 35%. You'll probably get an after-tax return of less than 1%. When expenses are considered.

I think it's riskier to invest in Vietnam then in a solid dividend generating company like Altria.