Credit boom, rule shifts fire up Vietnam banks’ capital-raising sprint
High system leverage, however, may leave them vulnerable to economic shocks, say analysts
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[HO CHI MINH CITY] Vietnam’s banks are starting on a capital-raising sprint, driven by fresh regulatory changes and surging credit demand as the country chases ambitious double-digit growth in the coming years, said analysts.
Banking system-wide lending – the primary financing channel for the country’s economic growth – expanded nearly 15 per cent in the year through October, the fastest pace in five years.
Analysts are forecasting a full-year credit growth of 18 to 20 per cent, powered by the US Federal Reserve’s monetary easing and a domestic low-rate environment to support the economy. The initial target was 16 per cent growth.
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