Q2 2015
www.bmiresearch.com
VIETNAM
COMMERCIAL BANKING REPORT
INCLUDES 5-YEAR FORECASTS TO 2019
ISSN 1758-454X
Published by:BMI Research
Vietnam Commercial Banking Report Q2
2015
INCLUDES 5-YEAR FORECASTS TO 2019
Part of BMI’s Industry Report & Forecasts Series
Published by: BMI Research
Copy deadline: February 2015
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CONTENTS
BMI Industry View 7
Table: Commercial Banking Sector Indicators 7
Table: Commercial Banking Sector Key Ratios, October 2013 7
Table: Annual Growth Rate Projections 2013-2018 (%) 7
Table: Ranking Out Of 73 Countries Reviewed In 2014 8
Table: Commercial Banking Sector Indicators, 2012-2019 8
SWOT 9
Commercial Banking 9
Political 10
Economic 11
Operational Risk 13
Industry Forecast 15
Economic Analysis 15
Industry Risk Reward Ratings 20
Asia Commercial Banking Risk/Reward Index 20
Table: Asia Commercial Banking Risk/Reward Index 21
Market Overview 22
Asia Commercial Banking Outlook 22

Table: Banks' Bond Portfolios, 2013 22
Table: Comparison of Loan/Deposit & Loan/Asset & Loan/GDP ratios, 2015 22
Table: Comparison of Total Assets & Client Loans & Client Deposits (USDbn) 23
Table: Comparison of USD Per Capita Deposits, 2015 24
Expecting Sustained Growth Momentum In 2015 25
Table: Economic Activity (Vietnam 2009-2018) 29
Competitive Landscape 30
Market Structure 30
Protagonists 30
Table: Protagonists In Vietnam's Commercial Banking Sector 30
Definition Of The Commercial Banking Universe 30
List Of Banks 31
Table: Financial Institutions In Vietnam 31
Company Profile 33
Agribank 33
Table: Balance Sheet (VNDmn) 35
Table: Balance Sheet (USDmn) 35
Table: Key Ratios (%) 35
Bank for Foreign Trade of Vietnam (Vietcombank) 36
Table: Stock Market Indicator 38
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Table: Balance Sheet (VNDmn) 38
Table: Balance Sheet (USDmn) 39
Table: Key Ratios (%) 39
Eximbank 40
Table: Stock Market Indicators 42
Table: Balance Sheet (VNDmn) 42
Table: Balance Sheet (USDmn) 42
Table: Key Ratios (%) 43

Sacombank 44
Table: Stock Market Indicators 46
Table: Balance Sheet (VNDmn) 46
Table: Balance Sheet (USDmn) 46
Table: Key Ratios (%) 47
VietinBank 48
Table: Stock Market Indicators 50
Table: Balance Sheet (VNDmn) 50
Table: Balance Sheet (USDmn) 51
Table: Key Ratios (%) 51
Regional Overview 52
Asia Overview 52
Global Industry Overview 56
Global Commercial Banking Outlook 56
EM External Corporate Debt A Potential Risk To Financial Stability 56
Eurozone and US Banking Outlooks 58
Emerging Market Regional Outlooks 58
Demographic Forecast 63
Table: Population Headline Indicators (Vietnam 1990-2025) 64
Table: Key Population Ratios (Vietnam 1990-2025) 64
Table: Urban/Rural Population & Life Expectancy (Vietnam 1990-2025) 65
Table: Population By Age Group (Vietnam 1990-2025) 65
Table: Population By Age Group % (Vietnam 1990-2025) 66
Methodology 68
Industry Forecast Methodology 68
Sector-Specific Methodology 69
Risk/Reward Index Methodology 70
Table: Commercial Banking Risk/Reward Index Indicators 71
Table: Weighting Of Indicators 72
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BMI Industry View
Table: Commercial Banking Sector Indicators
Date
Total
assets
Client
loans
Bond
portfolio Other
Liabilities
and capital Capital
Client
deposits Other
October 2012, VNDbn 3,688,076 2,938,250 355,697 394,129 3,688,076 583,666 2,861,204 243,206
October 2013, VNDbn 4,257,985 3,309,020 502,944 446,021 4,257,985 636,710 3,580,465 40,810
% change y-o-y 15.5% 12.6% 41.4% 13.2% 15.5% 9.1% 25.1% -83.2%
October 2012, USDbn 176.9 140.9 17.1 18.9 176.9 28.0 137.2 11.7
October 2013, USDbn 201.8 156.8 23.8 21.1 201.8 30.2 169.7 1.9
% change y-o-y 14.1% 11.3% 39.7% 11.8% 14.1% 7.8% 23.7% -83.4%
Source: BMI; Central banks; Regulators
Table: Commercial Banking Sector Key Ratios, October 2013
Loan/deposit ratio
Loan/asset ratio Loan/GDP ratio GDP Per Capita, USD Deposits per capita, USD
92.42% 77.71% 93.8% 2,007.2 1,853.9
Falling Falling Falling n.a. n.a.
Source: BMI; Central banks; Regulators
Table: Annual Growth Rate Projections 2013-2018 (%)


Assets Loans Deposits
Annual Growth Rate 10 8 5
CAGR 11 9 6
Ranking 23 28 46
Source: BMI; Central banks; Regulators
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Table: Ranking Out Of 73 Countries Reviewed In 2014
Loan/deposit ratio Loan/asset ratio Loan/GDP ratio
15 4 17
Local currency asset growth Local currency loan growth Local currency deposit growth
18 22 30
Source: BMI; Central banks; Regulators
Table: Commercial Banking Sector Indicators, 2012-2019

2012 2013 2014e 2015f 2016f 2017f 2018f 2019f
Total assets, VNDbn 3,917,557 4,466,015 5,091,257 5,753,121 6,443,495 7,152,280 7,939,030 8,759,397
Total assets, USDbn 188.0 211.7 238.0 267.0 301.8 338.2 379.0 422.1
Client loans, VNDbn 3,077,700 3,447,024 3,860,667 4,285,340 4,713,874 5,138,123 5,600,554 6,067,267
Client loans, USDbn 147.7 163.4 180.5 198.9 220.8 242.9 267.3 292.4
Client deposits, VNDbn 3,080,455 3,388,501 3,693,466 3,988,943 4,268,169 4,524,259 4,795,715 5,051,486
Client deposits, USDbn 147.8 160.6 172.7 185.1 199.9 213.9 228.9 243.4
e/f = estimate/forecast. Source: BMI; Central banks; Regulators
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SWOT
Commercial Banking
Vietnam Commercial Banking SWOT
Strengths
■

Untapped market with potential for increased participation of foreign banks.
■
Large population with a high savings rate and potential for income growth.
■
The Vietnamese government aims to speed up the process of privatising state-owned
banks, which will help modernise the industry.
■
State-owned banks will play a lesser role going forward, and the risks associated with
state-directed lending will decrease over time.
Weaknesses
■
Domestic banks continue to lag behind their foreign peers in terms of financial
strength and the technological curve.
■
Accounting standards lag behind international standards and the lack of transparency
entails significant risks for foreign investors.
■
Small banks have an overwhelming exposure to real estate and individual loans,
resulting in highly skewed and risky loan portfolios.
Opportunities
■
The country remains one of the most underbanked in the region, with significant
potential for adopting cash-free payment systems and new mobile banking
technologies.
■
Rising income levels and deepening capital markets could give rise to opportunities in
more sophisticated financial products and growth for the local asset management
industry.
Threats
■

Track record of macroeconomic instability threatens the credibility of the government
and could potentially drive economic policy away from further liberalisation.
■
The high level of government debt risks triggering a fiscal crisis, undermining
confidence in the banking sector.
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Political
SWOT Analysis

Strengths
■
The Communist Party of Vietnam remains committed to market-oriented reforms and
we do not expect major shifts in policy direction over the next five years. The one-
party system is generally conducive to short-term political stability.
■
Relations with the US have witnessed a marked improvement, and Washington sees
Hanoi as a potential geopolitical ally in South East Asia.
Weaknesses
■
Corruption among government officials poses a major threat to the legitimacy of the
ruling Communist Party.
■
There is increasing (albeit still limited) public dissatisfaction with the leadership's tight
control over political dissent.
Opportunities
■
The government recognises the threat corruption poses to its legitimacy, and has
acted to clamp down on graft among party officials.
■

Vietnam has allowed legislators to become more vocal in criticising government
policies. This is opening up opportunities for more checks and balances within the
one-party system.
Threats
■
Although strong domestic control will ensure little change to Vietnam's political scene
in the next few years, over the longer term, the one-party-state will probably be
unsustainable.
■
Relations with China have deteriorated over recent years due to Beijing's more
assertive stance over disputed islands in the South China Sea and domestic criticism
of a large Chinese investment into a bauxite mining project in the central highlands,
which could potentially cause wide-scale environmental damage.
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Economic
SWOT Analysis

Strengths
■
Vietnam has been one of the fastest-growing economies in Asia in recent years, with
GDP growth averaging 6.6% annually between 2000 and 2013.
■
The economic boom has lifted many Vietnamese out of poverty, with the official
poverty rate in the country falling from 58% in 1993 to 17.2% in 2012.
■
Vietnam has been strengthening its trade and aid ties in a bid to increase exports and
diversify its export sector.
Weaknesses
■

Vietnam still suffers from fiscal deficits, leaving the economy vulnerable to global
economic uncertainties. The fiscal deficit is dominated by substantial spending on
social subsidies that could be difficult to withdraw.
■
The heavily-managed and weak currency reduces incentives to improve quality of
exports, and also keeps import costs high, contributing to inflationary pressures.
Opportunities
■
WTO membership and the upcoming ASEAN economic integration in 2015 should
give Vietnam greater access to both foreign markets and capital, while making
Vietnamese enterprises stronger through increased foreign competition.
■
The government has continued to move forward with market reforms, including
privatisation of state-owned enterprises, addressing the high level of bad loans in the
banking sector as well as liberalising the banking sector.
■
Urbanisation will continue to be a long-term growth driver. The UN forecasts the
urban population rising from 32% of the population in 2013 to more than 50% by the
early 2040s.
Threats
■
Although inflation has subsided in 2014, complacency by the State Bank of Vietnam
on this front could result in a decline in investment.
■
The potential for an escalation of political tensions with China over sovereign claims
to parts of the South China Sea could have a negative impact on the economy.
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SWOT Analysis - Continued
■

Market reforms could progress at a much slower pace as the government remains
cautious about ceding ownership to foreign investors.
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Operational Risk
SWOT Analysis

Strengths
■
Vietnam has a high number of university graduates with skilled degrees and a high
literacy rate for its income level.
• In addition to a number of regional and international flight options, Vietnam has an
extensive inland waterway system.
■
Strong contract enforcement capabilities increase security.
• Vietnam's rate of violent crime is generally low, and foreigners are unlikely to be
targeted.
Weaknesses
■
High labour costs increase overall operating costs, and difficulty in hiring foreigners
creates shortages of skilled labour.
• Underdeveloped rail capacity overburdens the road network.
• One of the worst tax administration systems in Asia.
• The police force is under-equipped and under-resourced in many areas.
Opportunities
■
Fairly high expenditures in secondary education by regional standards will help close
gaps in access to education.
• Vietnam is easily accessible from the main shipping routes, and growth in the number
of port facilities will provide adequate capacity.

• Declining trade barriers are making it easier to enter the market.
• Increased foreign participation in the banking sector will increase the availability of
funds for loans.
Threats
■
Unequal access to secondary education will result in a lower-quality workforce in
poorer regions.
• Vietnam's reliance on imported oil poses risks in the form of energy and fuel
shortages.
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SWOT Analysis - Continued
• Corruption and inefficiency in the legal system.
• Anti-Chinese violence, as seen in May 2014, could be a harbinger of wider political
and social unrest.
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Industry Forecast
Economic Analysis
BMI View: While the Vietnamese economy has been strong, falling inflation and below-target credit growth
will spur further interest rate cuts by the State Bank of Vietnam (SBV). We maintain our forecast for the
SBV to cut its benchmark interest rate by a total of 50 basis points (bps) to 6.00% in 2015. Meanwhile, we
expect Vietnam's banking sector to gradually strengthen over the coming years as the government continues
with its reform efforts.
While we expect the Vietnamese economy to continue growing strongly over the coming quarters, on the
back of sustained foreign direct investment (FDI) inflows and healthy export sector growth, we nevertheless
continue to expect the State Bank of Vietnam (SBV) to maintain its dovish monetary stance. A combination
of falling inflation and still-slow credit growth suggest that the Vietnamese central bank will look to ease
policy rates. As such, we forecast another 50 basis points (bps) rate cut that will take the benchmark
refinancing rate to 6.00%, extending the SBV's monetary easing cycle that began in 2012 to a total of

900bps.
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Steady Recovery
Vietnam - Real GDP Growth, %
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015f
4
5
6
7
8
e/f = BMI estimate/forecast. Source: BMI, GSO
Sustained Economic Growth Momentum In 2015
The Vietnamese economy has continued its steady recovery amid ongoing economic reforms and loose
monetary conditions. We expect strong growth momentum to remain intact, and are forecasting real GDP
expansion to accelerate to 6.4% in 2015 from 6.0% in 2014. Indeed, Vietnam will attract greater foreign
investor interest, as it continues to offer foreign firms attractively low wages and generous tax incentives.
According to latest data from the General Statistics Office, total foreign registered capital rose 9.6% to
USD15.6bn, with most of it being channelled into the manufacturing sector. In addition, given the country's
strong export orientation to the US, which received roughly 19% of total Vietnamese outbound shipments in
2014, a recovering US economy will help to sustain a healthy rate of growth in Vietnam's export sector.

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Easing Price Pressures
Vietnam - Headline Inflation, % chg y-o-y
Source: BMI, GSO
Falling Inflation Provides Room For Further Rate Cuts
While economic growth has been strong, headline inflation continues to fall, providing room for continued
monetary easing. Consumer price inflation rose 4.1% on average in 2014, marking a significant decline

from the 6.6% recorded in 2013. We expect price pressures to remain largely contained over the coming
months, owing mainly to the slump in global oil prices. Consequently, we see inflation averaging just 2.1%
in 2015. Easing price pressures have in turn led to a rise in the real policy rate in recent months. Real
interest rates came in at 4.7% in December 2014, suggesting that current monetary policy is not terribly
loose.
Rate Cuts Likely To Spur Credit Growth
With room for policy easing, we expect the central bank to cut rates further to spur credit growth in the
country. A total of 67,823 enterprises had either suspended or ceased operations in 2014, representing an
11.7% increase versus that in 2013. This negative trend looks to persist, as local banks remain reluctant to
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provide financing owing to the high levels of non-performing loans on their books. Still-high lending rates
also played a part in the increasing number of company shut-downs over recent years. Consequently, all
these factors combined has resulted in sluggish credit growth, with year-to-date loan expansion coming in at
8.8% in October 2014, falling short of the central bank's full-year target for a 12.0-14.0% increase.
Banking Sector Improvement Remains On The Cards
In addition to further rate cuts, we believe ongoing banking reforms by the Vietnamese government will
help to strengthen the sector and encourage bank lending, although we note that progress on this front will
likely proceed at a gradual pace. The government established an entity, known as the Vietnam Asset
Management Company (VAMC), in July 2013 to clean up bad debt from the banking system and allow
domestic banks to undergo much needed restructuring. Meanwhile, the government also aims to speed up
state-owned enterprise reform in a bid to improve operational efficiencies and reduce their need to borrow
to finance their losses. SOEs currently account for more than half of the sector's sour loans. In the
government's latest efforts, the SBV will look to consolidate the banking sector through mergers and
acquisitions and seek to dissolve weak financial institutions that have very little chance of a recovery.
To Remain Anchored
Vietnam - 2-Year Government Bond Yields
Source: Bloomberg, BMI
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Bond Yields To Remain Anchored At Low Levels
Regarding the Vietnamese fixed income market, we expect easing price pressures to keep bond yields
anchored at current low levels. We also see the potential for additional interest rate cuts over the coming
months to push yields back down to 4.0%. That said, further yield compression from there on will likely be
limited, owing to sustained solid GDP growth momentum.
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Industry Risk Reward Ratings
Asia Commercial Banking Risk/Reward Index
Commercial Banking Risk/Reward Index Methodology
Since Q108, we have described numerically the banking business environment for each of the countries
analysed by BMI. We do this through our Commercial Banking Industry Risk/Reward Index (RRI), a
measure that ensures we capture the latest quantitative information available. It also ensures consistency
across all countries. Like all of BMI's Industry Risk/Reward Indices, its takes into account the Rewards on
offer within the banking sector in a given country, but also the Risks to investors being able to realise those
opportunities. The overall index is weighted 70% towards Rewards and 30% towards Risks.
Within the Rewards category, we look at factors that are specific to the banking industry (accounting for
60% of the score within this category), and elements that relate to that country in general (accounting for
40% of the weighting). These include, but are not limited to, total assets, asset and loan growth, GDP and
taxation. Likewise on the Risks side, we look at industry-specific Risks (weighted 40% of the Risks total)
and country-specific Risks (weighted 60%). These include, but are not limited to, the regulatory framework
and environment, the competitive environment, financial risk, legal risk and policy continuity.
In general three aspects need to be borne in mind when interpreting the RRIs. The first is that the Industry
Rewards element is the most heavily weighted of the four elements, accounting for 42% (60% of 70%) of
the overall Index. Second, if the Industry Rewards score is significantly higher than the Country Rewards
score, within the Rewards category, it usually implies that the banking sector is (very) large and/or
developed relative to the general wealth, stability and financial infrastructure in the country. Conversely, if
the industry score is significantly lower, it usually means that the banking sector is small and/or
underdeveloped relative to the general wealth, stability and financial infrastructure in the country. Third,
within the Risks category, the industry-specific elements (i.e. how regulations affect the development of the

sector, how regulations affect competition within it, and Moody's Investor Services' Ratings for local
currency deposits) can be markedly different from BMI's long-term Country Risk Index for a given market.
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Table: Asia Commercial Banking Risk/Reward Index

Limits of Potential Returns Risks to Potential Returns Overall

Market Structure Country Structure Market Risks Country Risks Index Ranking
Bangladesh 56.7 47.5 43.3 46.0 50.6 52
China 93.3 57.5 63.3 70.0 75.5 15
Hong Kong 80.0 95.0 73.3 80.0 83.4 4
India 83.3 57.5 60.0 54.0 68.0 28
Indonesia 73.3 65.0 80.0 54.0 68.3 26
Japan 33.3 75.0 66.7 78.0 57.0 40
Malaysia 73.3 80.0 83.3 80.0 77.6 11
Pakistan 50.0 50.0 53.3 46.0 49.7 54
Philippines 53.3 62.5 60.0 62.0 58.3 38
Singapore 66.7 95.0 96.7 84.0 81.3 8
Sri Lanka 33.3 57.5 33.3 50.0 43.1 62
South Korea 76.7 85.0 83.3 78.0 80.0 10
Taiwan 76.7 72.5 86.7 74.0 76.2 12
Thailand 66.7 65.0 86.7 70.0 69.2 23
Vietnam 60.0 57.5 36.7 54.0 55.4 42
New Zealand 43.3 87.5 86.7 84.0 68.2 27
United States 93.3 85.0 100.0 82.0 89.8 2
Scores out of 100, with 100 the highest. Source: BMI
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Market Overview

Asia Commercial Banking Outlook
Table: Banks' Bond Portfolios, 2013

Bond Portfolio, USDbn Bond as % total assets Year-on-year growth %
Bangladesh 26.8 25.8 30.5
China* 1,873.0 8.7 17.5
Hong Kong* 379.3 19.8 8.1
India* 352.5 25.8 14.4
Indonesia** 17.3 4.3 17.7
Japan 2,456.3 28.0 -4.5
Malaysia 77.8 12.8 -4.6
Pakistan 40.4 42.7 5.9
Philippines 42.7 21.1 8.0
Singapore 93.2 12.1 5.4
Sri Lanka 7.5 22.7 51.2
South Korea 268.7 15.2 -10.2
Taiwan 209.1 15.6 86.4
Thailand 80.4 16.3 4.7
Vietnam* 20.4 10.9 64.4
New Zealand 11.8 3.5 -9.0
United States 486.4 3.5 -8.5
Source: Central banks, regulators, BMI. **Only 2011 data available. * Only 2012 data available.
Table: Comparison of Loan/Deposit & Loan/Asset & Loan/GDP ratios, 2015

Loan/Deposit
ratio % Rank Trend
Loan/Asset
ratio % Rank Trend
Loan/GDP
ratio % Rank Trend

Bangladesh 89.1 40 Rising 63.9 20 Falling 46.9 52 Rising
China 84.0 51 Rising 49.9 49 Falling 141.3 9 Rising
Hong Kong 71.7 64 Rising 38.8 65 Rising 297.8 1 Rising
India 76.9 59 Falling 67.6 12 Falling 55.2 46 Rising
Indonesia 77.5 46 Falling 64.1 17 Falling 34.9 58 Falling
Japan 67.3 65 Falling 47.6 52 Falling 90.5 20 Falling
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Comparison of Loan/Deposit & Loan/Asset & Loan/GDP ratios, 2015 - Continued

Loan/Deposit
ratio % Rank Trend
Loan/Asset
ratio % Rank Trend
Loan/GDP
ratio % Rank Trend
Malaysia 72.7 60 Falling 60.1 32 Falling 116.7 13 Falling
Pakistan 61.0 69 Rising 44.1 60 Falling 21.6 66 Rising
Philippines 70.6 67 Rising 53.2 48 Rising 40.9 55 Rising
Singapore 104.9 14 Falling 58.2 39 Falling 151.1 8 Falling
Sri Lanka 81.0 54 Rising 58.9 36 Falling 33.5 61 Rising
South Korea 126.1 4 Falling 74.3 6 Rising 96.8 18 Rising
Taiwan 81.1 57 Rising 63.2 28 Rising 164.1 7 Rising
Thailand 99.1 26 Falling 67.6 13 Rising 94.2 19 Rising
Vietnam 107.4 17 Rising 74.5 2 Falling 100.2 16 Rising
New Zealand 192.5 2 Rising 89.5 1 Rising 160.3 6 Falling
United States 104.8 21 Rising 73.1 7 Rising 64.0 37 Rising
Source: Central banks, regulators, BMI
Table: Comparison of Total Assets & Client Loans & Client Deposits (USDbn)


2015 2014

Total Assets Client Loans Client Deposits Total Assets Client Loans Client Deposits
Bangladesh 142.7 91.2 102.4 122.3 78.1 89.5
China 30,895.9 15,417.7 18,364.4 28,482.3 14,213.3 17,400.0
Hong Kong 2,496.6 969.3 1,352.3 2,337.8 899.3 1,266.3
India 1,876.5 1,268.9 1,651.1 1,589.2 1,074.6 1,374.9
Indonesia 486.6 312.1 402.5 455.9 297.7 352.0
Japan 7,944.8 3,780.8 5,619.2 7,880.6 3,787.8 5,519.1
Malaysia 632.1 380.0 522.8 602.5 362.1 475.9
Pakistan 126.4 55.7 90.9 110.6 48.8 81.4
Philippines 238.1 126.5 179.3 218.3 109.5 165.1
Singapore 774.3 450.5 429.6 800.0 458.7 415.2
Sri Lanka 45.2 26.6 32.8 39.2 23.1 28.9
South Korea 1,846.1 1,371.3 1,087.2 1,781.3 1,310.5 1,034.1
Taiwan 1,367.6 864.9 1,066.7 1,308.5 805.1 1,020.6
Thailand 540.6 365.4 368.7 516.3 347.3 350.4
Vietnam 267.0 198.9 185.1 238.0 180.5 172.7
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Comparison of Total Assets & Client Loans & Client Deposits (USDbn) - Continued

2015 2014
New Zealand 302.7 271.0 140.8 330.5 293.0 153.7
United States 16,025.1 11,713.4 11,173.7 15,047.1 10,896.2 10,541.2
Source: Central banks, regulators, BMI
Table: Comparison of USD Per Capita Deposits, 2015

GDP Per Capita
Client Deposits, per

capita
Rich 20% Client
Deposits, per capita
Poor 80% Client
Deposits, per capita
Bangladesh 1,227 638 2,554 160
China 7,873 13,103 52,410 3,276
Hong Kong 44,499 184,902 739,609 46,226
India 1,801 1,288 5,150 322
Indonesia 3,579 1,574 6,296 393
Japan 32,932 44,309 177,236 11,077
Malaysia 10,709 17,056 68,224 4,264
Pakistan 1,387 483 1,934 121
Philippines 3,035 1,761 7,044 440
Singapore 53,060 76,455 305,819 19,114
Sri Lanka 3,673 1,520 6,079 380
South Korea 29,839 21,853 87,413 5,463
Taiwan 22,281 45,448 181,792 11,362
Thailand 5,798 5,470 21,878 1,367
Vietnam 2,134 1,982 7,928 496
New Zealand 37,825 30,625 122,501 7,656
United States 53,967 34,367 137,469 8,592
Source: Central banks, regulators, BMI
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Expecting Sustained Growth Momentum In 2015
BMI View: We expect solid growth momentum in the Vietnamese economy to be carried over to 2015, on
the back of continued foreign direct investment (FDI) inflows, strong performance in the manufacturing and
export sectors, and ongoing efforts by the government to address the high level of bad debts in the banking
sector. We maintain our forecast for real GDP to grow at 5.7% in 2014, ahead of an acceleration to 6.4%

in 2015.
In line with our positive outlook for the Vietnamese economy, Vietnam's real GDP growth accelerated to
6.2% year-on-year (y-o-y) in Q314 from the revised 5.4% print in the previous quarter. Notably, this
marked the fastest pace of expansion since Q411, bringing real GDP growth to 5.6% y-o-y in the first nine
months of 2014, exceeding the Bloomberg consensus estimate of 5.4% for the same period.
Fastest Economic Expansion Since Q411
Vietnam - Real GDP, % chg y-o-y
Source: BMI, GSO
The strong headline figure largely owes to a robust performance in the manufacturing and export sectors.
Indeed, the manufacturing sector grew by 8.6% y-o-y in September, the fastest pace since February, while
Vietnam Commercial Banking Report Q2 2015
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