Capital increase for Big 4 banks: Pressure is growing

The massive issuance of bonds to increase Tier 2 capital cannot reduce the pressure to increase capital at state-owned commercial banks (Big 4). Meanwhile, to serve the target of double-digit growth in the coming period while maintaining macroeconomic stability, the role of these banks is very important.

Falling behind in the race to increase capital

Since the beginning of the year, a series of private joint stock commercial banks have massively increased their charter capital according to the resolution of the 2025 shareholders' meeting that was approved. Some banks have just completed the capital increase and have asked for shareholders' opinions on continuing to increase capital in the next round. Meanwhile, state-owned joint stock commercial banks are still waiting for approval from competent authorities, even though the capital increase plan was approved by the shareholders' meeting a long time ago.

Among the Big 4 banks, since the beginning of the year, only Vietcombank has increased its charter capital significantly through paying dividends in shares. VietinBank and Agribank have maintained the same charter capital as last year and are much lower than many private joint stock commercial banks such as VPBank, Techcombank, MB. Similarly, BIDV's charter capital has increased insignificantly.

“Although the increase in charter capital for state-owned joint stock commercial banks has recently been taken care of and handled by competent authorities, the State Bank believes that the increase is still far from the actual requirements to improve financial capacity and implement Basel II according to the advanced method - Basel III at state-owned joint stock commercial banks, because the increase in charter capital of state-owned joint stock commercial banks depends on additional capital sources from the state budget and requires the opinions of relevant ministries and agencies,” State Bank Governor Nguyen Thi Hong admitted in a report to the National Assembly .

It is known that, for VietinBank , it was not until early October 2025 that this bank received the decision approving the plan to invest additional state capital at VietinBank from the State Bank and the official dispatch on dividend payment in shares of VietinBank from the Government Office (on the issuance of shares to pay dividends from the remaining profits in 2021, 2022 and the period 2009-2016). It may be in early 2026 that this bank can complete the capital increase from the remaining accumulated profits in the period 2009-2016, 2021 and 2022.

Regarding the capital increase by paying dividends in shares from the remaining profits in 2023 and the charter capital supplement fund of VietinBank, in a recent report to the National Assembly, the State Bank said that it is only drafting a document to submit to the Prime Minister.

At BIDV, the State Bank has sent a request for comments from the Ministry of Finance on the draft submission to the Prime Minister on a plan to increase capital for BIDV from the remaining profit in 2023, the reserve fund to supplement charter capital and issue individual shares/issue through the public.

In the case of Agribank - the only 100% state-owned bank in the Big 4 group, the capital increase situation is even more difficult. Agribank is currently the bank with the lowest charter capital in the Big 4 group. Although it has proposed to the Government and the State Bank to supplement the minimum charter capital of VND 10,000 billion per year from 2025, it has not yet been approved.

Need to innovate capital increase mechanism for Big 4 banking group

Currently, the group of state-owned commercial banks holds more than 50% of the credit market share of the entire system. This is also the main force that invests capital in priority areas according to the Government's orientation and maintains stable interest rates. To serve the need for double-digit growth in the coming period, increasing capital for this group of banks is increasingly urgent.

Mr. Pham Toan Vuong, General Director of Agribank, said that if the annual credit balance increases by VND200,000 billion, the Bank needs to add VND15,000-17,000 billion in equity capital. Therefore, Mr. Vuong proposed that the National Assembly and the Government consider a separate mechanism for state-owned commercial banks, including considering providing additional charter capital from Agribank's annual actual profits, at least VND10,000 billion/year, starting from 2025.

The pressure to increase capital of the Big 4 banking group is even stronger in the context that from 2025, the State Bank of Vietnam will pilot the elimination of credit room. In addition, Circular No. 14/2025/TT-NHNN of the State Bank of Vietnam (effective from September 15, 2025) also requires banks to improve their capital capacity to approach international standards (Basel III). Accordingly, the Circular sets out clear and separate requirements for core capital level 1 and level 1 capital, instead of focusing only on total capital value.

According to FiinRatings' report, Tier 1 capital still accounts for the majority of banks' capital structure, but dependence on Tier 2 capital has increased since 2024, especially through bond issuance activities of state-owned banks and medium-sized joint stock commercial banks.

Difficulties in increasing Tier 1 capital have forced banks to increase bond issuance to increase Tier 2 capital in recent times. However, the Capital Adequacy Ratio (CAR) of state-owned banks remains low (over 10%) and the pressure to increase core capital when Circular 14/2025/TT-NHNN of the State Bank takes effect is very large.

According to FiinRatings experts, state-owned banks need to focus on increasing core capital through retained earnings. Besides, if they cannot increase capital strongly, these banks can only maintain a moderate credit growth rate in the coming time.

Although the Government has repeatedly urged the State Bank to speed up the increase of charter capital of state-owned commercial banks, with the current mechanism, the increase of capital using retained profits of these banks must seek opinions from many ministries and branches before submitting to the Prime Minister for consideration and approval.

Therefore, experts recommend that it is necessary to soon change the capital increase mechanism for Big 4 banks so that these banks can continue to play a pivotal role in promoting economic growth in the coming period.

Source: https://baodautu.vn/tang-von-cho-ngan-hang-big-4-ap-luc-dang-lon-dan-d426375.html