EIB Leads Banking Selloff as VN-Index Drops 10.6 Points on Rate-Cut Pressure

Overview

Eximbank (EIB) fell 3.92% to VND 17,150 on October 26, leading a broad decline in Vietnamese banking stocks that pulled the VN-Index down 10.6 points, or 0.6%, to 1,763.55. The selloff followed State Bank of Vietnam (SBV) direction requiring banks to cut deposit rates by at least 0.5 percentage points per year for tenors of six months or more and to end the deposit-rate race. Foreign investors net sold nearly VND 892 billion across the three exchanges.

Key Facts

• VN-Index closed at 1,763.55, down 10.6 points (-0.6%) on October 26; the index had briefly exceeded 1,780 in the morning session.
• EIB fell 3.92% to VND 17,150; VPB -2.07%, SHB -1.83%, VIB -1.76%, HDB -1.55%, STB -1.31%, VCB -1.23%, TCB -1.17%, MBB -1.26%, CTG -1.13%, BID -1.46%.
• Securities stocks also weakened: SHS -3.13%, ORS -3.13%, VCI -2.3%, VIX -1.57%, VND -1.45%, SSI -0.75%; HCM rose 0.63%.
• Foreign investors bought about VND 1,247 billion and sold more than VND 2,139 billion, net selling nearly VND 892 billion (about USD 35.68 million).
• FPT was the most heavily net-sold at roughly VND 258 billion, followed by HDB (VND 80 billion), VPL (VND 69 billion), ACB (VND 62 billion) and MBB (VND 51 billion).
• VN30-Index fell 17.56 points (-0.92%) to 1,889.53; HNX-Index lost 1.29% to 259.32 and UPCoM-Index slipped 0.25% to 125.95.
• Market breadth was negative with 409 decliners (18 limit-down), 229 gainers and 867 unchanged; liquidity on the three exchanges reached about VND 14,533 billion, down nearly 20% from the prior session.

What Happened

The session opened on a firm note, with the VN-Index briefly crossing 1,780 points, but selling pressure built from late morning and persisted into the afternoon. Banking stocks, often described locally as the “king” sector, bore the brunt. EIB posted the steepest fall among large banks at 3.92%, while VPB, SHB, VIB, HDB, STB, VCB, TCB, MBB, CTG and BID all declined by between roughly 1.1% and 2.1%. ACB and MSB were roughly flat.

The trigger, according to Tuổi Trẻ’s market report, was the SBV’s directive that lenders reduce deposit rates by at least 0.5 percentage points per year for tenors of six months or more and halt the deposit-rate race. Many banks have since lowered listed rates, though the article notes that market-wide deposit rates remain high. Securities stocks fell in sympathy, with SHS and ORS each down 3.13%. Real estate was mixed: DXG -3.35%, VRE -2.8%, DIG -1.97%, VHM -0.62%, NVL -0.47%, while VIC edged up 0.21%. Energy names bucked the trend, with BSR +1.2%, PLX +0.56%, GAS +0.56% and PVD +0.27%.

Market Context

EIB trades on HOSE and closed at VND 17,150 on October 26. The stock’s 3.92% decline was the sharpest among the large-cap banks cited in the report, exceeding the 0.92% fall in the VN30-Index and the 0.6% drop in the VN-Index. The move extends a weak stretch for Vietnamese bank shares, which have been pressured by the SBV’s push to lower funding costs and by foreign outflows. Foreign investors have been persistent net sellers, and the October 26 net sale of nearly VND 892 billion, with FPT the single largest drag, underscores the external liquidity headwind facing the market. Liquidity of about VND 14,533 billion, down nearly 20% session-on-session, suggests buyers stepped back rather than capitulated.

Strategic Significance

For long-term investors, the SBV’s directive reframes the bank earnings outlook: lower deposit rates should compress funding costs and support net interest margins over time, but the immediate market reaction reflects concern about the pace of repricing and the sector’s ability to defend spreads as loan rates also fall. EIB’s outsized decline points to its relatively high sensitivity to deposit-rate policy and to its thinner capital and profitability buffers compared with state-owned peers such as VCB and BID. The divergence within the sector, with ACB and MSB flat while EIB fell nearly 4%, suggests the market is beginning to discriminate by funding mix and asset quality rather than selling the sector indiscriminately. The energy sector’s gains indicate that capital is rotating rather than exiting Vietnamese equities outright.

What to Watch

• SBV follow-up guidance or inspection results on whether banks have complied with the 0.5 percentage-point deposit-rate cut.
• EIB’s next quarterly earnings release and any disclosure on funding costs and net interest margin.
• Foreign-ownership and foreign-flow data for EIB and the banking sector over the coming sessions.
• Liquidity trends on HOSE, given the nearly 20% session-on-session drop to VND 14,533 billion.
• Any SBV policy meeting minutes or statements clarifying the intended pace of further rate reductions.