With bank lending remaining the primary source of capital for the economy, recent credit-easing measures by the State Bank of Vietnam (SBV) are viewed as a flexible policy response to support the country's double-digit economic growth target.
Over the past month, the State Bank of Vietnam (SBV) has launched a strategic campaign to invigorate the economy through a suite of policy shifts designed to loosen credit conditions and stimulate domestic lending.
The central bank’s interventions aim to unclog credit pipelines by introducing greater flexibility for commercial lenders. Key measures include a revision to the calculation methodology for the loan-to-deposit ratio (LDR) and an increase in the regulatory ceiling for using short-term funds to finance medium- and long-term projects, which has been raised to 40 percent.
Beyond broad regulatory adjustments, the SBV is also utilizing targeted growth incentives. The bank has revised credit growth limits for 25 commercial banks, specifically focusing on capital allocation for social housing and industrial park infrastructure.
Additionally, the regulator has opened a specialized credit mechanism to support key projects undertaken by three major developers including Vingroup, Sun Group, and Masterise.
Collectively, these moves represent a coordinated effort to bolster capital access and provide the necessary liquidity to drive growth in critical sectors of the economy.
According to estimates by Vietcombank Securities (VCBS), the SBV’s decision to increase the maximum ratio of short-term funds that can be used for medium- and long-term lending from 30 percent to 40 percent, effective July 1 under Circular 25/2026, could expand medium- and long-term lending by about 10 percent. This would add approximately VND1-1.5 quadrillion in outstanding loans to the economy.
The additional capital is expected to flow into sectors with long investment payback periods, including real estate, renewable energy, public investment and industrial infrastructure, helping support the banking sector’s credit growth target of around 17 percent in 2026.
Nguyen Minh Tuan, CEO of AFA Capital, said Vietnam’s capital supply structure remains heavily dependent on bank credit, while medium- and long-term funding channels such as the stock market, corporate bonds and investment funds are not yet sufficiently developed to share the burden.
According to Nguyen Minh Tuan, as Vietnam enters a new investment cycle with substantial funding demand for transport infrastructure, energy projects and large-scale build-transfer (BT) projects, the higher ceiling will provide banks with greater capacity to finance physical infrastructure, factories and long-term projects. It will also help ease liquidity pressures and improve resilience against external shocks.
Credit expansion push sparks call for stricter banking oversight
Despite the positive implications for economic growth, many experts argue that expanded credit capacity must be accompanied by stricter oversight mechanisms.
Lecturer Chau Dinh Linh of Ho Chi Minh City Banking University noted that using short-term funds to finance long-term loans always carries maturity mismatch risks, making the banking system more vulnerable to fluctuations in interest rates and deposit flows. He said the SBV should develop monitoring scenarios and conduct stress tests on the banking system.
From a market perspective, Mirae Asset Securities warned that prioritizing credit for medium- and long-term loans could make short-term financing for production and business activities more expensive due to supply-demand imbalances. Expanded credit capacity could also increase the risk of funds indirectly flowing into the real estate sector if not closely monitored.
Regarding the SBV’s newly introduced credit mechanism for key projects of Vingroup, Sun Group and Masterise, lawyer Truong Thanh Duc, Director of ANVI Law Firm and a member of the Vietnam International Arbitration Center (VIAC), said the policy could encourage banks to participate in financing large-scale projects while maintaining system safety ratios. However, he stressed that the decisive factor remains each bank’s ability to balance its funding sources.
ANVI Law Firm Director Truong Thanh Duc noted that the biggest risk currently lies in banks using short-term deposits to finance medium- and long-term loans, a model that is rarely applied internationally because of potential maturity mismatches. From July 1, 2026, the maximum ratio of short-term funds used for medium- and long-term lending will increase from 30 percent to 40 percent.
Meanwhile, short-term deposits currently account for about 80 percent-90 percent of total mobilized funds, equivalent to VND13 quadrillion-VND15 quadrillion, creating room for an additional VND1.3 quadrillion-VND1.5 quadrillion in medium- and long-term credit.
“Relaxing certain safety criteria may support the double-digit growth target, but it will also increase pressure on liquidity management and risk governance. Therefore, lending decisions must still be based on funding capacity, project efficiency and borrowers’ repayment ability. In the long term, Vietnam needs to develop alternative medium- and long-term funding channels outside the banking system to reduce dependence on credit,” the director of ANVI Law Firm said.
