Bright door to increase capital for commercial banks from policy of loosening foreign room

Decree No. 69/2025/ND-CP of the State Bank of Vietnam, effective from May 19, 2025, only applies to private joint-stock commercial banks. Therefore, among the four participating banks, including HDBank (HDB), MBBank (MBB), Vietcombank (VCB) and VPBank (VPB), the new foreign ownership limit (FOL) will not apply to VCB - a state-owned bank.

The expansion of the foreign ownership limit to 49% from the current 30% will create conditions for these banks to access international capital sources, especially in the context of the urgent need to increase capital to maintain the capital adequacy ratio (CAR).

VIS Rating believes that if HDB, MBB and VPB maintain asset growth rates higher than the industry average (over 25%) and maintain profitability over the next two years, they will need to raise additional equity. Without timely capital increase plans, the CAR of this group of banks could fall by 150 to 300 basis points by the end of 2026.

Decree No. 69/2025/ND-CP of the State Bank of Vietnam, effective from May 19, 2025, only applies to private joint stock commercial banks.

Currently, most banks still rely on retained earnings and issuing Tier 2 bonds to raise capital. However, according to VIS, the participation of foreign strategic investors will not only help inject capital but also improve risk management capacity, expand access to international capital sources and support the implementation of long-term business strategies.

Reality has proven the role of foreign capital in improving banking capacity. With the support of Sumitomo Mitsui Banking Corporation (SMBC), VPBank has tripled its lending scale to FDI enterprises in 2024. Most recently, on May 5, 2025, the bank announced the successful mobilization of a syndicated loan worth 1 billion USD arranged by SMBC and a number of foreign banks, serving the goal of sustainable finance.

However, it is not easy for all banks to raise foreign capital. VPBank took nearly 2 years to complete the sale of 15% of its shares to SMBC in 2023. HDBank has also been looking for foreign investors for the past 5 years, while MBB has not announced any specific plans regarding foreign strategic partners. Therefore, VIS believes that in the short term, these banks will still depend on retained earnings and bonds to supplement capital.

As for Vietcombank – which is not covered by the new decree – the foreign ownership ratio remains at 30%. However, the bank plans to offer an additional 6.5% of its capital in the 2025–2026 period, including strategic partner Mizuho. If successful, Vietcombank’s CAR could increase by more than 200 basis points compared to the current level.

VIS Rating emphasized that expanding foreign room not only creates room for capital increase but is also a strategic boost to help banks restructure, strengthen financial capacity, improve competitive position and promote sustainable growth in the context of deep integration into the global financial market.

Minh Thu

Source: https://doanhnghiepvn.vn/kinh-te/tai-chinh-ngan-hang/cua-sang-tang-von-cho-ngan-hang-thuong-mai-tu-chinh-sach-noi-room-ngoai/20250523090359907