Vietnam’s bank ownership rule shift may draw foreign strategic investors but risks remain

[HO CHI MINH CITY] Vietnam is throwing open the doors to deeper foreign stakes in its banking sector, but while the higher ownership cap may lure fresh capital, analysts have warned that murky balance sheets and mismatched valuations could keep eager investors at bay.

Effective May 19, the government is allowing up to 49 per cent foreign ownership – up from 30 per cent – for a select group of banks that has taken over struggling peers, as part of efforts to accelerate the central bank’s restructuring push.

“These institutions now have greater flexibility in pursuing overseas strategic partnerships and investors,” said Tyler Nguyen, chief market strategist at Ho Chi Minh City Securities Corporation (HSC).