Vietnam Holding argues that the country’s leading lenders are no longer a simple leveraged play on growth; they are the institutions driving the transformation itself
Vietnam is one of the world’s fastest-growing economies, and its banks are where that growth is being financed, intermediated and monetised, acting as both a facilitator and beneficiary of Vietnam’s growth.
Vietnam Holding, the London-listed fund managed by Dynam Capital, believes the sector can compound earnings through the next chapter of Vietnam’s growth story.
Banks account for almost 40% of the Vietnam Holding portfolio, with five banks, including Hoa Phat Group, Techcom Bank, and MB Bank, in the top ten holdings.
The bull case for Vietnamese banks has evolved with Vietnam’s underlying investment case.
A few years ago, the story was one of penetration. Put simply: open more accounts. That job is largely done: by 2025, 89% of Vietnamese adults held a payment account, up from around 30% in 2010.
The opportunity now is deepened engagement with additional products: payments, lending, wealth, insurance and investment products across increasingly digital ecosystems.
This fast becomes a flywheel for Vietnamese wealth creation, expansion of the middle classes, and economic growth – all with the banks in Vietnam Holding’s portfolio at the centre.
The cyclical tailwind
A powerful cyclical story underpins growth in the banking sector and adoption of its products. The government has framed an “era of national ascent,” targeting double-digit GDP growth over 2026–2030, supported by large-scale infrastructure and strategic national projects.
Total social investment is put at roughly USD1.47 trillion across the period. Because Vietnam’s capital markets are still in their own growth phase, banks carry the funding load, typically financing 40–60% of large projects, and up to 70% for the most bankable. That translates into sustained, structural demand for medium- and long-term credit.
However, credit growth has outpaced deposits. Lending grew 19.1% in 2025 versus deposit growth of 12.1%, leaving a persistent funding gap of VND2,300–2,700 trillion into 2026. This means that careful selection of individual banks is required.
The credit-to-GDP ratio has reached 145% and is climbing. In that environment, the question is no longer “do we like Vietnamese banks?” but “which banks can fund profitable growth without wrecking margins, over-stretching capital or compromising asset quality?”
This is at the heart of Vietnam Holding’s thesis. Banks with sticky, low-cost retail deposits (high CASA), strong capital, disciplined underwriting and credible digital franchises can widen the gap between themselves and weaker rivals.
Winners are those securing diversified funding from interbank financing, certificates of deposit, offshore syndicated and sustainability-linked loans, while extending maturities and protecting net interest margins.
VNH’s conviction
Vietnam has seven core screens for selecting banks: funding, capital, returns, asset quality, franchise strength, governance and valuation, that produce a concentrated, high-conviction cohort of banks for the portfolio.
Leading private banks such as MBB, TCB, VPB and HDB stand out for retail franchises, digital ecosystems and capital headroom, positioning them to take share faster than peers.
Among state-owned banks, VCB is favoured for its high CASA and low funding costs.
Policy is broadly supportive of the banks and feeds Vietnam Holding’s conviction. The State Bank of Vietnam has eased liquidity rules, raised the ceiling on short-term funding used for long-term lending, and excluded priority infrastructure and social-housing loans from credit quotas.
Value vs growth
From a valuation perspective, Vietnamese banks are attractive against regional and global peers: return on equity of 16–18%, five-year EPS growth of 15–20%, and 2026 price-to-book of 1.1–1.3x.
Cash dividend yields are modest at 2.5–3.5%, but for high-ROE banks reinvesting into a formalising economy, retained capital is the point; the right question is what management can earn on the capital it keeps, not how much it pays out.
Vietnam Holding
For investors, Vietnam Holding’s argument is that the economic growth and attractive valuations of the banks (and wider Vietnamese equity space) are precisely the conditions in which active, on-the-ground stock selection earns its keep.
In a market where the spread between strong and weak banks is widening, owning the right franchises, rather than the index, is the case for both Vietnam and for the Vietnam Holding Investment Trust designed to provide investors with a concentrated, high-conviction portfolio of leading Vietnamese growth stocks.