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The State Bank of Vietnam (NHNN) has published a draft amendment to Circular 22/2019 governing safety limits in banking operations and the branches of foreign banks. A key proposed change is the shift in the main metric from the loan-to-deposit ratio (LDR) to the credit-deposit ratio (CDR), calculated using total outstanding credit and total mobilized funds as defined in the circular.
Under the draft, the CDR would be calculated based on total outstanding credit and total mobilized funds, while retaining existing components used in the current framework. These include corporate bond holdings, off-balance-sheet credit commitments, and funding sources outside deposits.
The draft also adjusts how deposits from the State Treasury (KBNN) are counted toward bank funding. Circular 22/2019 previously allowed KBNN term deposits to be counted toward funding but required a gradual reduction, with the treatment set to be eliminated in 2026.
In the new draft, NHNN softens this approach. For KBNN term deposits, banks would exclude 80% of the deposits from funding calculations, meaning only 20% would be counted.
NHNN said that, given the current liquidity-tight environment and following the Prime Minister’s directive, Circular 22 should be reconsidered and amended to address provisions related to KBNN deposits.
As of the end of March 2026, KBNN deposits in the banking system were reported at 626,716 billion dong. Of this total, state-owned banks held 624,167 billion dong, equivalent to 99.59% of total KBNN deposits across credit institutions.
NHNN noted that in early 2026, the LDRs of VietinBank, BIDV, VietcomBank, and Agribank have been trending higher. As of March 31, 2026, their LDRs were 83.48%, 82.94%, 84.54%, and 83.28%, respectively—close to the 85% maximum threshold.
NHNN also highlighted that KBNN deposits are typically short-term (up to three months) and can be unstable, as they may be withdrawn to meet budget cash needs or when deposits mature but the bank does not win renewal.
At the same time, NHNN pointed to international practice under the NSFR framework, where part of government deposits can be included in stable funding available to banks. Against this backdrop, NHNN said revising the calculation to extend the counting of 20% of KBNN deposits in the ratio—based on the existing rules—would be appropriate under current conditions.
NHNN added that the proposed treatment would also create “headroom” for KBNN deposits at banks to be used to meet capital needs and support market liquidity.
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