Vietcombank is one among the Vietnam Report's ranking of the  top 10 prestige banks in Việt Nam. — VNA/VNS Photo

HÀ NỘI — Vietcombank has taken out the top slot in Vietnam Report’s Top 10 Vietnamese Commercial Banks of 2021 ending months of speculation. The rankings, announced on Tuesday, saw banks from all over Việt Nam ranked based on surveys, their financial capacity, and media coverage.

Vietnam Report pointed out that despite the COVID-19 pandemic, banks still made good profits in the first half of this year with more than 10 reporting profits of trillions of đồng with bad-debt ratios labelled ‘under-good-control’.

Vietcombank was followed by VietinBank, Techcombank, MB, and ACB. Other names in the list included VP Bank, BIDV, TPBank, HDBank and Agribank.

The latest update from the General Statistics Office (GSO) showed that credit growth had expanded by 5.47 per cent by June 21, double the rate of the same period last year.

Vietnam Report also cited data from FiinGroup that showed banking revenue in the first quarter of this year rose by 28.4 per cent.

The banking sector’s growth was supported by lower interest-rates on deposits but lending rates being left unchanged. In addition, many banks issued a large amount of long-term bonds with low yields, helping to improve their net profit margins.

According to Vũ Đăng Vinh, general director of Vietnam Report, growth prospects for the banking sector remain “positive” but there are still concerns around the unpredictable nature, and subsequent impacts, of the pandemic.

COVID-19 has seen many companies pushed into difficulty. The GSO’s statistics show that more than 70,200 firms have temporarily halted operation, applied to be dissolved, or been dissolved in the first half of this year.

Other challenges to the banking sector were the need to comply with international standards and the growing competition in digital transformation projects. This includes not only the diversification of products and services but also with fintech and big tech companies entering the digital payments and consumer lending markets.

Vietnam Report also pointed out that bottlenecks in policies for new business models were also hindering the development of the banking sector. A number of new business models have also appeared in the financial sector such as digital banking, digital currency and peer-to-peer lending. Banks are also faced with cybersecurity risks.

In this context, banks should hasten the development of digital banking, Vietnam Report says, adding that the pandemic is providing an opportunity for banks to restructure their revenue sources from providing credit to providing services to meet the rising demand for cashless payments.

Vietnam Report said that 2021 would be a boom year in digital transformation, which would draw the participation of not only the private sector but also State-owned banks.

Vietnam Report’s survey findings revealed that 58.33 per cent of banks were implementing digital transformation on a large scale, 16.67 per cent were partially undergoing a digital transformation, and the rest were preparing to consolidate their operating systems.

Green banking was another development trend the report mentioned. It emphasised the importance of providing loans to green economic sectors like renewable energy, environment services, green property development, green traffic projects, food, climate change adaptation and energy efficiency. — VNS