State Bank of Vietnam raises short-term funding cap for medium- and long-term lending to 40%; which banks stand to benefit most?

NHNN recently issued Circular 25/2026/TT-NHNN, relaxing several safety ratios for commercial banks. The circular takes effect from July 1, 2026. Accordingly, the maximum ratio of short-term funds used for medium- and long-term lending has been raised from 30% to 40%. At the same time, the Governor of NHNN decided that the State Treasury's term deposits would be counted into the LDR ratio on a phased basis (compared with the current fixed 20% under Circular 08/2026/TT-NHNN). According to Vietcap's assessment, in the context of rising capital needs from large-scale and long-term infrastructure and Build–Transfer (BT) projects, Circular 25 will help banks enhance their ability to provide funds for these projects. Pressure on banks to mobilize medium- and long-term funds will be reduced, as such funding is expensive and less accessible in Vietnam. The industry as a whole will benefit from the perspective of net interest margin (NIM). However, some banks whose exposure as of end-Q1 2026 is near the old 30% cap, including Techcombank (TCB), VPBank (VPB) and MB (MBB), will benefit more. Additionally, state-owned banks such as Vietcombank (VCB), BIDV (BID) and VietinBank (CTG), which have large lending exposure to infrastructure, will also benefit as the disbursement pace of medium- and long-term loans accelerates, although their current ratios are not very close to the 30% cap. Regarding the State Treasury's term deposits, Vietcap's analysts say this change will give NHNN greater flexibility in supporting system liquidity. For example, if NHNN decides to raise this ratio, it would help reduce banks' LDR, particularly for state-owned banks since most time deposits of the State Treasury are kept there. It is estimated that every 10 percentage-point change in this ratio would lead to a 0.6-0.8 percentage-point change in the LDR of state-owned banks VCB (Vietcombank), BID (BIDV), CTG (VietinBank). Overall, these changes will ease the rising cost of funds pressures for banks in the near term, thereby helping to lower lending rates and support the economy. Moreover, this Circular reaffirms NHNN's flexible stance toward monetary policy in balancing growth with macroeconomic stability. Although Vietcap acknowledges that these changes will increase maturity-mismatch risk for the system, this policy move is appropriate to optimize available funding to support the government's infrastructure development objectives, a core strategy for sustainable long-term growth of Vietnam's economy. Based on international practice, Vietcap suggests that commercial banks will fund the construction phase of these infrastructure projects. As projects become operational and generate cash flow, project owners can access international markets to restructure loans, thereby reducing risk for domestic banks.