Vietnamese banks delivered a mixed performance in 2025. Asset quality improved at several State-owned banks (SOBs) and large private banks, reducing the sector’s problem loan ratio by 20 basis points (bps) to 2.1%, supported by recovering real estate conditions and year end write-offs. Meanwhile, majority of mid-sized banks fell short of their full-year profit targets, as net interest margin (NIM) narrowed due to rising deposit costs, a shift toward lower-yield corporate loans, as well as higher credit costs. Liquidity pressures also intensified for mid-sized and smaller banks, driven by heavier reliance on short term interbank borrowings, declining CASA deposits, and loan growth outpacing deposit growth—prompting further deposit rate increases to secure funding. Looking ahead to 2026, banks’ asset quality and profitability are expected to diverge, with large banks to remain resilient under a stable domestic environment and ongoing policy support.
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