Along with the regulation of credit growth (down from 19% to 15% according to the State Bank of Vietnam's scenario), banks will face significant liquidity pressure. This factor will considerably dominate the outlook for bank profits in a context where credit growth requires more selectivity.

Bank Profits Maintained Despite Diverging NIM

From late 2025 to early 2026, liquidity pressure has become evident within the banking system, especially among small banks that rely on funding from the interbank market. Rising deposit rates while lending rates struggle to increase correspondingly have caused the Net Interest Margin (NIM) of banks to decline.

In a recent report on the banking industry by FiinRatings, Mr. Nguyễn Quang Thuân, FCCA, Chairman of FiinGroup, along with associates from the Research & Analysis Division, noted: The industry-wide NIM may stay below 3.0% in 2026, pressured by higher capital costs and narrowed loan yields. Conversely, focusing on longer-term lending and consumer credit could help maintain NIM at levels comparable to 2025.

NIM is diverging by bank groups. Specifically, for the group of four large joint-stock banks (VPBank, Techcombank, MB, ACB), NIM is likely to stabilize (supported by higher CASA), with ROA maintained above the industry average but lower than the 2022 peak; they are becoming increasingly dependent on non-interest income.

For the group of state-owned commercial banks (Vietcombank, VietinBank, BIDV, and Agribank), NIM tends to decrease slightly due to continued interest rate support for customers. Foreign exchange, gold, and debt recovery operations are becoming the primary revenue sources.

Other joint-stock banks: NIM will diverge between those with and without the ability to attract/exploit retail customers and those with strong positions in certain non-interest income segments.

Banks Increase Debt Write-offs

Problematic loans continued to decrease in 2025 from the 2023 peak: The industry-wide Non-Performing Loan (NPL) ratio was approximately 1.9% in 2025, steady compared to the previous two years; SML decreased to about 1.2% by the end of 2025 (from about 1.9% in 2024), indicating a reduction in early-warning loan quantities. This improvement mainly came from rapid credit growth and significant debt write-offs.

The net write-off rate on average outstanding loans increased to 1.3%, slightly higher than the stable 1.2% level during the 2023–2024 period. In 2026, FiinRatings experts stated they do not expect banks to write off debt as aggressively as in previous years; instead, VAMC bonds may return as a supporting tool for asset quality management.

Provisioning levels at the end of 2025 were at their lowest since 2021, reflecting banks' increased reliance on write-offs and debt recovery rather than just increasing provisions.

Credit growth (19.0%) continued to outpace deposit growth (11.4%) in 2025, leaving banks dependent on the interbank market and bond issuances. After two years of rapid growth, we forecast the entire industry and many banks will face significant liquidity pressure throughout 2026.

Waiting for Time to Balance Capital Structure

Capital costs rose at the end of 2025 and are likely to continue rising in 2026. In a context where many banks rely significantly on wholesale funding and the majority of customer deposits are short-term (

In all groups, capital and profit indicators mostly declined. In the group [a] banks, the significant drop in the provision coverage ratio and LLR, despite aggressive write-offs, shows that the buffer against asset quality pressure continues to thin, becoming more dependent on collateral and debt recovery.

Asset quality indicators show inconsistent divergence, with bank groups ([aa] and [bbb]) improving while groups ([a] and [bb and below]) decline. Conversely, profit indicators show the opposite trend, reflecting different strategies of banks during a high-growth period.

The CET1 capital-to-total assets ratio of state-owned commercial banks (6.4%) shows moderate improvement but remains lower than the group of four large joint-stock banks (11.1%) and other joint-stock banks (7.8%), highlighting a structural weakness in capital for the state-owned sector despite its systemic role. The provision coverage ratio improved at state-owned commercial banks (157%) and large joint-stock banks (104%) but remains low at other joint-stock banks (52%), indicating a weaker buffer against credit shocks in the group of medium and small private banks.

According to FiinRatings, although the four large joint-stock banks have a lower ratio of deposits to total funding (62%) compared to smaller joint-stock banks (66%), they possess a more diverse funding structure and lower capital costs, partly thanks to valuable papers and their position in the interbank market.

As of now, following instructions from SBV Governor Phạm Đức Ấn regarding balancing and utilizing capital, reducing costs, and ensuring interest rate stability, 26 banks have fulfilled their commitment to lower deposit rates by 0.5-1%. Many banks have reduced lending rates by 0.5% to 3%.

However, for deposit and lending rates to establish a low and stable floor, external factors and the restructuring of bank capital over time are still needed to reach a break-even point with new capital prices. Recent bank capital increase plans are also expected to be promoted following the annual general meeting season, quickly bolstering banks to both ensure a "thick buffer" and provide opportunities to accelerate business expansion in the remaining three quarters of the year.