SBV Credit Policy Shift: 28 Banks Post 19% Profit Growth in 2025, Real Estate Lending Under Scrutiny

Overview

The State Bank of Vietnam (SBV) is implementing a policy to redirect credit flow from real estate toward productive sectors, aiming to improve capital allocation efficiency and support sustainable economic growth. In 2025, 28 commercial banks reported aggregate pre-tax profit of nearly 356,600 billion VND, up 19% year-on-year, highlighting the banking sector’s strong performance. The policy shift directly impacts major listed banks including BID, VCB, CTG, and MBB, which hold significant real estate exposure.

Key Facts

• 28 commercial banks and BaoVietBank reported 2025 pre-tax profit of nearly 356,600 billion VND, a 19% increase year-on-year.
• Total credit outstanding reached 18.58 million billion VND in 2025; the 2026 credit growth target is approximately 15%, equivalent to an additional 2.8 million billion VND.
• Real estate loans accounted for about 4.5 million billion VND by end-2025, representing nearly 25% of total outstanding credit.
• At many banks, real estate loan ratios exceed 30%, with some above 50%.
• The five largest banks (Vietcombank, VietinBank, BIDV, Agribank, MB) held collateral assets worth nearly 16 million billion VND, of which real estate was approximately 11.64 million billion VND.
• In Q1 2026, real estate and banking accounted for 90% of the 24,800 billion VND in corporate bond issuances.
• Vietnam’s credit-to-GDP ratio reached about 146%, among the highest globally, while the ICOR remained elevated at 6-7.

What Happened

According to an article published during the annual general meeting season, the SBV is intensifying its directive to reorient credit away from real estate and toward manufacturing, small and medium enterprises, and other productive sectors. The article notes that despite strong banking profitability in 2025, the economy remains overly reliant on credit, with capital allocation inefficiencies reflected in a high ICOR. The SBV aims to control credit growth from the start of the year, limit concentration in risky sectors like real estate, and prevent real estate credit from growing faster than the overall credit pace. Banks are being urged to proactively restructure their loan portfolios.

The article emphasizes that this is not a credit tightening but a “raising of standards” to improve credit quality. Several banks have already begun reducing their real estate lending share and shifting toward retail, SME, and manufacturing loans. Additionally, commercial banks are lowering deposit rates as directed by the SBV to optimize funding costs and create room for lending rate reductions.

Market Context

On April 15, 2026, BID closed at VND 40,000 (-0.12%), VCB at VND 60,000 (+1.01%), CTG at VND 35,000 (unchanged), and MBB at VND 27,000 (-0.37%). The banking sector has been a key driver of the VN-Index, but the SBV’s policy shift introduces uncertainty regarding future credit growth and asset quality. BID, listed on HOSE, is one of the Big 4 state-owned banks with substantial real estate exposure, making it particularly sensitive to the policy direction.

Strategic Significance

For long-term investors, the SBV’s credit reorientation signals a structural shift in Vietnam’s banking landscape. Banks with high real estate concentration face pressure to diversify loan books, potentially compressing near-term lending growth but improving long-term asset quality. The policy aims to reduce systemic risk from the real estate-banking nexus and support higher-value sectors. Banks that successfully pivot to productive lending and maintain cost efficiency may benefit from more stable margins and lower NPLs. The high credit-to-GDP ratio suggests that future credit expansion will be more measured, favoring banks with strong capital bases and risk management.

What to Watch

• Q1 2026 earnings reports from BID, VCB, CTG, and MBB for signs of portfolio restructuring and NPL trends.
• SBV’s official 2026 credit growth target and any sector-specific caps on real estate lending.
• Changes in the ratio of real estate loans to total credit at major banks in upcoming quarterly disclosures.
• Corporate bond issuance data for Q2 2026 to gauge the shift away from real estate and banking.
• SBV policy meeting minutes or further guidance on interest rate adjustments and credit allocation.