SBV Circular 08/2026 Eases LDR Pressure for State-Owned Banks Like BID, VCB, CTG
This Aveluro analysis covers BID (Đầu tư và Phát triển Việt Nam (BIDV), có tiền thân là Ngân hàng Kiến thiết Việt Nam trực thuộc Bộ Tài chính được thành lậ) in the Banking sector. The classified event type is regulation change, with positive sentiment and a deterministic market-impact score of 7.0/10. Aveluro classifies this story as a positive catalyst in the stock's news coverage. Source coverage came from CafeF - Tài chính ngân hàng, classified as a primary/top-tier source.
Key Facts
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Overview
The State Bank of Vietnam (SBV) issued Circular 08/2026/TT-NHNN on May 15, 2026, amending Circular 22/2019/TT-NHNN to allow banks to count 20% of State Treasury term deposits in the denominator of the loan-to-deposit ratio (LDR). This change directly benefits major state-owned banks—BIDV (BID), Vietcombank (VCB), VietinBank (CTG), and Agribank (AGR)—which collectively held over VND 563 trillion in such deposits as of Q1 2026. The move eases liquidity pressure as credit growth outpaces deposit mobilization, helping these banks maintain LDR below the 85% regulatory ceiling.
Key Facts
- Circular 08/2026/TT-NHNN was issued on May 15, 2026, effective immediately.
- Banks can now include 20% of State Treasury term deposits in the LDR denominator.
- As of Q1 2026, Vietcombank’s LDR was 84.54%, VietinBank 83.48%, BIDV 82.94%, and Agribank 83.28%—all near the 85% cap.
- The three listed state-owned banks (VCB, BID, CTG) held over VND 563 trillion in State Treasury deposits, up nearly 39% from end-2025.
- For Vietcombank, the change adds approximately VND 37 trillion to the LDR denominator (20% of its ~VND 185 trillion Treasury deposits).
- Total system credit reached VND 19.5 quadrillion as of April 28, 2026, up 4.42% YTD and over 18% YoY.
- The gap between credit and deposits widened to VND 1.4–2 quadrillion, pressuring liquidity.
What Happened
On May 15, 2026, the State Bank of Vietnam promulgated Circular 08/2026/TT-NHNN, amending point a, clause 4, Article 20 of Circular 22/2019/TT-NHNN. The amendment allows credit institutions to include 20% of term deposits from the State Treasury in the total deposits used to calculate the LDR ratio. Previously, under Circular 22/2019 and Circular 26/2022, all State Treasury term deposits were excluded from the LDR denominator starting in 2026, which would have significantly tightened liquidity for banks holding large Treasury balances.
The SBV’s decision comes amid rapid credit growth that has outpaced deposit mobilization. By April 28, 2026, system-wide credit reached VND 19.5 quadrillion, while deposits grew more slowly, creating a funding gap of VND 1.4–2 quadrillion. The circular effectively provides mechanical relief to LDR ratios without requiring banks to aggressively raise retail deposits or curtail lending.
Market Context
On May 19, 2026, BID closed at VND 44,250 (-2.32%), VCB at VND 64,400 (+1.90%), CTG at VND 35,800 (-1.38%), and AGR at VND 14,700 (+0.34%). The mixed price action suggests the market is still digesting the circular’s implications. All four banks trade on HOSE (except AGR on UPCOM) and are among the largest by assets in Vietnam. The banking sector has faced headwinds from rising credit demand and regulatory tightening on LDR, making this circular a positive catalyst for liquidity management. The SBV’s move signals a pragmatic approach to balancing credit growth with prudential ratios, aligning with Basel III principles.
Strategic Significance
For long-term investors, Circular 08/2026 reduces the risk of a liquidity crunch at state-owned banks, which are critical to Vietnam’s credit intermediation. By allowing 20% of Treasury deposits to count toward LDR, the SBV provides these banks with greater flexibility to expand lending without breaching regulatory limits. This is particularly important as the government pushes for higher credit growth to support economic expansion. The circular also reflects a shift toward more nuanced regulatory oversight, moving away from rigid rules that could constrain systemically important banks. For BID, VCB, and CTG, the change directly improves their LDR headroom, potentially supporting higher loan growth and net interest margins.
What to Watch
- Q2 2026 earnings reports from BID, VCB, CTG, and AGR to see actual LDR improvements and loan growth.
- Any further SBV circulars adjusting other prudential ratios (e.g., capital adequacy) in response to credit growth.
- Changes in State Treasury deposit levels, as a decline could reduce the benefit of the circular.
- Market reaction in banking stocks, particularly if credit growth accelerates without margin compression.
- Potential for similar regulatory adjustments for other bank groups (e.g., private banks) if liquidity pressures persist.