FiinGroup: Banks to face sustained liquidity pressure throughout 2026

The net interest margin (NIM) of non-state-owned, joint-stock banks is expected to diverge across institutions based on two main factors: their ability to attract and use retail customers and their strength in certain non-interest income businesses, according to an update from FiinGroup on the banking sector outlook.

Credit growth outpaced GDP growth in 2025

In 2025, GDP growth was outpaced by credit growth. System-wide credit rose by about 19% in 2025, exceeding the typical 15% target set by the State Bank of Vietnam in previous years.

FiinGroup said credit expansion was supported by infrastructure expansion, industrial activity led by foreign direct investment, the real estate sector, and a recovery in retail lending.

2026 outlook: slower credit growth and tighter constraints

For 2026, FiinGroup expects credit growth to be lower than in 2025, citing a high credit-to-GDP ratio already above 140%.

New measures from the State Bank in 2026 are also expected to slow real estate lending activity. These include requiring each bank’s lending balance in Q1 2026 to not exceed 25% of the annual credit limit for 2026, and limiting each bank’s real estate lending growth in 2026 to not exceed overall 2025 credit growth.

Basel III and the unwinding of lending caps may widen differences between banks

Capital requirements under Basel III and the unwinding of lending caps are expected to increasingly differentiate credit growth among banks. FiinGroup noted that larger banks with stronger capital positions are likely to gain market share, while smaller non-state joint-stock banks may calibrate expansion to balance capital, profitability, and asset quality.

NIM trends: industry decline in 2025

For the full year 2025, the industry-wide NIM declined to 2.9% (about 3.3% in H1 2025 and 3.5% in 2024). The peak was 3.8% in 2022.

Rating agencies’ 2026 NIM expectations by bank group

Rating agencies issued 2026 earnings outlooks by group:

• Top 4 joint-stock commercial banks (JSCBs): NIM is likely to stabilize, supported by higher CASA ratios. ROA is expected to remain above the sector average but below the 2022 peak, with performance increasingly reliant on non-interest income.
• State-owned banks (SOCBs): a mild NIM decline is expected as they continue to provide interest-rate relief for customers. Foreign exchange and gold trading, along with debt collection, are identified as key income drivers.
• Other JSCBs: NIM dispersion is expected to depend on retail customer traction and strength in non-interest income businesses.

Credit growth outpacing deposits and liquidity pressure

Credit growth of 19.0% continued to outpace deposit growth of 11.4% in 2025. As a result, banks are expected to remain reliant on interbank funding and bond issuance.

After two years of rapid growth, FiinGroup forecasts that the sector and many banks will face significant liquidity pressure throughout 2026.

Funding costs expected to rise in 2026

Funding costs had increased by the end of 2025 and are likely to continue rising in 2026. Because many banks rely heavily on wholesale funding and most customer deposits are short-term (less than 1 year), banks are expected to raise deposit rates sharply to attract longer-term deposits. CD and bond yields are also expected to rise in 2026 to support longer-term funding needs.

Credit rating outlook: sector remains neutral

For FY2025, the median credit rating remained anchored around A-, reaffirming the sector’s neutral rating for the banking industry.

Among 30 commercial banks, seven improved their credit profiles in FY2025 compared with the first half of 2025 (1H2025). Their ratings ranged from A to BB, and none recorded further deterioration in credit quality over the same period.