Credit across Vietnam’s economy continued to accelerate from the start of the year, although the State Bank of Vietnam warned that inflationary pressure, exchange rate volatility and businesses’ limited ability to absorb capital remain major challenges.

Outstanding loans in the banking system had exceeded VND19.4 quadrillion (approximately US$747 billion) as of April 28, 2026, up 4.42% from the end of 2025 and 18.26% higher than the same period last year.

The figures were shared by Pham Thi Thanh Tung, Deputy Director of the Credit Department for Economic Sectors at the State Bank of Vietnam, during a seminar titled “The role of the banking sector in promoting economic growth” held in Hanoi on May 8.

Several sectors accounted for large shares of total lending, including agriculture and rural development with VND4.3 quadrillion (US$165 billion), equivalent to about 22.2% of total outstanding loans, and small and medium-sized enterprises with nearly VND3.8 quadrillion (US$146 billion), or 20%.

Credit growth for export businesses and high-tech enterprises also accelerated sharply, rising 11.2% and 18.81%, respectively, in the first quarter of 2026.

Outstanding green credit loans exceeded VND780 trillion (US$30 billion), while loans assessed for environmental and social risks surpassed VND5.1 quadrillion (US$196 billion).

However, the central bank noted that banking credit activities continue to face multiple challenges, including external pressures such as supply chain disruptions, strategic competition among major powers, reciprocal tariff policies, military conflicts, surging energy prices and rising transportation costs.

The economy also remains heavily dependent on bank credit, with the credit-to-GDP ratio estimated at around 145% in 2025, while the capital market has yet to develop proportionately.

At the same time, maturity risks persist as around 80% of VND-denominated deposits are short-term, despite continued strong demand for medium- and long-term capital. Interest rates are also showing signs of increasing.

Nguyen Phi Lan, Director General of the Forecasting, Statistics and Monetary-Financial Stability Department at the State Bank of Vietnam, said achieving economic growth of 10% or higher this year will face significant headwinds.

He pointed to growing external risks, including tensions in the Middle East and tariff-related uncertainties, which are weakening traditional growth drivers such as investment, exports and consumption.

Meanwhile, newer growth engines including science and technology, innovation, digital and green transformation, and the private sector have yet to deliver immediate economic impact.

Vietnam is also seeing signs of a widening trade deficit as large-scale infrastructure and transport projects are launched simultaneously, increasing demand for imported machinery and equipment.

Inflationary pressure is becoming more pronounced due to instability stemming from Middle East conflicts, while the exchange rate continues to face upward pressure.

The persistently high credit-to-GDP ratio also poses potential risks to the monetary and financial system.

“Based on current developments and the economic growth outlook for the remaining months of 2026, the State Bank of Vietnam and the banking sector will continue prioritising inflation control and macroeconomic stability as overarching objectives,” Nguyen Phi Lan said.

“Macroeconomic stability remains the foundation for attracting investment, maintaining market confidence and supporting sustainable economic growth.”

Speaking at the seminar, Deputy Governor Pham Thanh Ha acknowledged that capital demand in the economy remains very large, while the ability to absorb capital in certain sectors is still limited.

Many businesses, particularly small and medium-sized enterprises, continue to face difficulties accessing credit.

He stressed that credit expansion must go hand in hand with improving credit quality, controlling risks, handling bad debts and ensuring the safety of the banking system.

Global economic, trade and financial conditions also remain unpredictable, adding pressure to policymaking and financial management, he added.

“In that context, the banking sector’s proactive deployment of support measures for the economy is extremely important,” Pham Thanh Ha said.

“At the implementation meeting on April 9, banks showed strong consensus on reducing deposit and lending interest rates, demonstrating the sector’s determination to share difficulties with businesses and the public while supporting economic growth.”

Photo caption: Deputy Governor of the State Bank of Vietnam Pham Thanh Ha speaks at the seminar in Hanoi on May 8. Photo by Hoang Giap.

Tuan Nguyen