Expand operations, increase bank revenue

Although the forecast has many challenges, according to some economic experts, banks still have many opportunities to expand operations and increase revenue in 2025.

In particular, with the Government's determination to support GDP growth to reach the target of 8% through promoting public investment, lending opportunities for banks are also expected to expand further. Based on the forecasted positive credit growth trend in 2025, it will help banks increase revenue and profit.

OPEN UP MANY LENDING OPPORTUNITIES

According to experts from VinaCapital's Macroeconomic Analysis and Market Research Department, the US economy will support Vietnam's GDP growth in 2024, but internal factors will play a major role in boosting Vietnam's economy in 2025.

With the Government's determination to support GDP growth to reach the target of 8% through promoting public investment, lending opportunities for banks are also expected to expand further. Based on the forecasted positive credit growth trend in 2025, it will help banks increase revenue and profit.

Experts predict that Vietnam's export growth to the US will slow down in 2025, but growth in domestic factors such as infrastructure investment, real estate and consumption will improve.

Slow export growth will affect GDP growth, however, most of Vietnam's exports are thanks to FDI enterprises, which do not borrow much from domestic banks. Thus, slow export growth does not affect domestic banks too much.

Furthermore, banks will still be the beneficiaries of the shift to GDP growth thanks to the above-mentioned internal factors, as Vietnamese banks finance almost all sectors of the domestic economy; at the same time, they also lend heavily to real estate and consumption - sectors that will boost the economy in 2025.

In particular, the Government also plans to support GDP growth in 2025 by boosting public investment, which is expected to further expand lending opportunities for banks.

HDBank Deputy General Director Tran Hoai Nam also pointed out a number of favorable opportunities for the bank's business operations, coming from the fact that important laws related to many economic fields have been amended and supplemented and are gradually coming into practice, creating a more transparent and stable legal environment.

Along with the recovery prospects of the real estate market, corporate bonds, consumer growth and the possibility of upgrading the stock market also promise to attract international capital flows, increasing economic development momentum.

According to Mr. Nam, the shift of global investment capital to Vietnam opens up great opportunities to expand operations and promote international cooperation. Banks can take advantage of this trend to expand their operating networks, improve services and attract more domestic and foreign customers.

RESPONDING TO DIFFICULTIES AND CHALLENGES

Along with the opportunities opening up for banks to transform strongly, it is also forecasted that in 2025, banks' businesses will face many challenges in the context of global economic and geopolitical fluctuations that continue to put pressure on profits and sustainable development goals.

HDBank Deputy General Director Tran Hoai Nam acknowledged that, in any context, risk management and compliance are always the "key" for banks to develop safely and sustainably.

Vietnam Investor Services and Credit Rating Joint Stock Company (VIS Rating) - an affiliate of Moody's also pointed out that in 2025, the banking industry still has potential risks, especially risks related to real estate. Some small and medium-sized banks have a high proportion of loans to troubled real estate developers.

This could put pressure on their asset quality, while large banks have an advantage by focusing on lending to manufacturing and commercial enterprises. Therefore, to maintain stable growth, banks need to focus on risk management, expanding safe investment portfolios and optimizing funding costs.

Banking operations still face risks from the corporate bond market and bad debt handling issues. According to experts, the corporate bond market is currently unstable, and many companies are having difficulty issuing bonds and managing debt. As the capital market remains limited, the pressure on the economy to supply capital to the banking sector will be even greater.

In addition, in the context of the complex and unpredictable global and domestic economy, the debt repayment capacity of businesses and households may be affected, leading to an increase in the bad debt ratio.

Bad debt settlement faces significant challenges due to the incomplete legal framework. Currently, the handling of collateral assets to settle bad debt continues to face difficulties as Resolution No. 42/2017/QH14 of the National Assembly on piloting bad debt settlement of credit institutions has not been legalized, causing great risks for the banking sector.

Vietcombank Chairman Nguyen Thanh Tung said that Vietcombank proposed that the State Bank continue to operate monetary policy cautiously and flexibly to adapt to the changing context, in order to maintain an optimal balance between economic growth targets and inflation control, and between exchange rates and interest rates.

Source: https://nhandan.vn/mo-rong-hoat-dong-gia-tang-doanh-thu-ngan-hang-post860277.html