Vietnam banks’ H2 profit, credit growth hinge on real estate recovery: expert
The growth of net interest margin (NIM) and credit in Vietnam’s banking sector during the second half of this year will hinge on the revival of the local real estate industry, said an expert.
The profit outlook for the banking sector may remain quite bleak until the end of this year, though it could vary between banks, forecast Nguyen The Minh, head of research at Yuanta Securities Vietnam.

Real estate credit outlook could be rosier in the second half of 2024. Photo by The Investor/Trong Hieu.
A recent survey by the State Bank of Vietnam, or the central bank, indicated that 72.7% of credit institutions are projected to see rosier outlooks in Q2 and throughout 2024.
About 86.2% of respondents expected to witness year-on-year pre-tax profit growth in 2024, while 10.1% anticipated a decline, and 3.7% predicted no change.
Another report showed that 10 out of 27 listed banks saw profits decrease in Q1, including Vietcombank (VCB), MB Bank (MBB), VIB bank (VIB), Maritime Bank (MSB), and Eximbank (EIB), all listed on the Ho Chi Minh Stock Exchange (HoSE).
The main driver for banking profits this year is expected to come from interest incomes, since non-interest incomes are just beginning to rebound, Minh noted.
Banks with high rates of current account savings account (CASA) and the ability to inject credit into the economy, especially in the real estate sector, will see positive profits in H2, he elaborated.
In Q1/2024, Techcombank (HoSE: TCB) recorded a CASA rate of 40.5%, the highest in the banking sector, followed by MB Bank with 36.1%, Vietcombank with 33.2%, MSB with 29.2%, and TPBank with 24.4%.
The current net interest margin landscape is generally good but will face challenges in H2. However, Minh predicted that the banking industry could be brightened up by real estate credit, which typically accounts for a significant portion of banking activity with mid- and long-term loans and high interest rates.
Therefore, the growth of credit and NIM will largely depend on the recovery of the realty segment buoyed by the government’s support for project legality, the expert noted.
In addition to real estate credit, banking profits will be influenced by non-interest incomes and asset quality, Minh added.
Non-interest incomes will primarily stem from foreign exchange driven by exchange rate increases and recovering corporate bonds. Meanwhile, asset quality will improve the extension of Circular 02, which aims to mitigate bad debts and risk provision costs for local banks.
In general, Minh said that banking profits may experience mild growth, mainly propelled by credit growth with an expected revival of real estate credit in the last months of 2024.
Moreover, raising charter capital through share issuances and dividend payouts will help banks improve their NIM, while acquiring underperforming banks will promote credit growth and enlarge their foreign ownership caps.
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