Vietnam banks unveil business plans for 2025

Many commercial banks in Vietnam will hold their AGMs at the end of March or early April, where key issues of investor interest will be discussed, including their business plans for 2025.

The National Citizen Bank (NCB), listed on the Hanoi Stock Exchange (HNX) as NVB, will hold its AGM on March 29. NCB has set a target of VND59 billion ($2.31 million) in pre-restructuring profit for 2025.

The bank has committed to using all profits for its restructuring plan. Additionally, it aims to achieve total assets of VND135.5 trillion ($5.3 billion) and customer deposits of VND118.5 trillion, up 14.6% and 23.2% year-on-year, respectively.

The board of directors of Eximbank (HoSE: EIB) has approved a proposal from its acting CEO on business plans for 2025, which will be presented at the AGM. The bank aims for a pre-tax profit of VND5.58 trillion ($218.42 million), a more than 33% increase compared to 2024. If this target is achieved, Eximbank will set a new profit record.

The bank plans to reach total assets of VND265.5 trillion ($10.39 billion), up 10.8% year-on-year. Deposits are projected to rise by 15.5% to VND206 trillion, while outstanding credit is expected to grow by 16.2% to VND195.5 trillion. The non-performing loan (NPL) ratio is expected to inch down by 0.54% to 1.99%.

Vietnam International Bank (HoSE: VIB) has announced documents to be presented to its AGM, scheduled for March 27. The bank has set a pre-tax profit target of VND11.02 trillion ($431.35 million), a 22% rise compared to 2024.

VIB aims to achieve total assets of VND600.35 trillion ($23.5 billion), up 22% year-on-year. Total outstanding credit is expected to grow by 22% to VND395.8 trillion, and deposits are projected to increase by 26%, reaching VND377.3 trillion. The NPL ratio will be kept under 3%.

Meanwhile, SeABank has set a credit growth target of 15%, in line with the maximum credit cap set by the State Bank of Vietnam (SBV). The bank also aims for a 16% increase in deposits and expects total assets to grow by 10%.

Given these targets, SeABank (HoSE:SSB) anticipates a pre-tax profit of VND6.46 trillion ($252.87 million), a nearly 10% increase from its 2024 target, and a return on equity (ROE) ratio of 13.8%.

Nam A Bank (HoSE: NAB) has presented its business plan to the 2025 AGM, with a pre-tax profit target of VND5 trillion ($195.72 million), a 10% increase from the previous year, and a dividend payout of 25%.

The bank expects total assets to reach VND270 trillion ($10.57 billion), with personal and institutional loan balances of VND194 trillion (up 16% year-on-year) and deposits (including personal, institutional, and securities) of VND209 trillion (up 17%). The NPL ratio is expected to remain below 2.5%, with all safety ratios in compliance with regulations.

Similarly, VPBank (HSX:VPB) has set a consolidated profit growth target for 2025 at 20-25%. In 2024, the bank recorded a pre-tax profit of over VND20 trillion ($782.9 million). As a result, VPBank has set its profit target for 2025 between VND24 trillion and VND25 trillion.

Prospects for banking stocks in 2025

According to SBV Deputy Governor Dao Minh Tu, an average credit growth of more than 2% will help GDP expand by 1%. In 2025, the central bank aims for a credit growth of around 16% to achieve an 8% GDP growth.

However, if GDP growth reaches 10%, credit growth must rise by 18-20%, meaning the banking sector will need to inject an additional VND2,800-3,100 trillion ($121.35 billion) into the economy.

Economists believe that regardless of the growth level, real estate and infrastructure will be the main drivers of credit growth this year. Additionally, credit for exports, particularly agricultural shipments, is expected to maintain momentum, even amid trade conflicts.

Regarding the banking sector's prospects, experts from BIDV Securities (BSC) expect a 20% profit growth in 2025. This will be driven by a slight improvement in NIM (net interest margin), manageable asset quality supported by debt restructuring regulations for struggling customers, and continued credit growth, with a greater impact from retail credit and the recovery of the real estate market.

BSC notes that in 2025, the push for public infrastructure projects will directly benefit state-owned banks in terms of credit growth. The banking sector will enter a phase of reducing credit costs, boosting profit growth, and benefit from the recovery of the real estate market, with a high proportion of credit allocated to developers and homebuyers.

However, BSC also cautions that there are risks, such as slower-than-expected real estate recovery, the possibility of higher-than-expected NPLs, and continued pressure on NIM due to intense competition in the sector.

Meanwhile, analysts from Vietcap Securities forecast that asset quality in the banking sector will improve in 2025, supported by a low-interest-rate environment and strong credit demand. They predict that the NPL resolution ratio will increase as banks continue to clean up their balance sheets.

The prospects for banks in 2025 will be varied. Experts suggest that this will be the year when the entire sector focuses on strengthening the loan loss coverage ratio (LLCR), as the buffer accumulated during the Covid-19 period has been exhausted.

As a result, there will be limited room to use provisions for managing NPLs. Banks with high LLCR will have an advantage in managing credit cost pressures in 2025, while those that made relatively low provisions in 2023-2024 will face higher provisioning pressures, which may impact profits.