Preventing the risk of NPLs from returning

In light of the aforementioned circumstances, several experts stated that some Land Law provisions that impede the registration of property ownership changes and the purchase of real estate assets should be changed. Conversely, banks have to make more provisions for bad debts and be cautious when making new loans.

Fostering debt recovery

Banks have been aggressively increasing debt collection since the end of 2025 and the start of 2026, viewing this as a major priority for the year. Through their branches, a number of banks, including Agribank, BIDV, Vietcombank, VPBank, HDBank, and AnBinhBank, are aggressively selling off their debts.

Mr. Pham Toan Vuong, Member of the Board of Directors and General Director of Agribank, the bank had very favorable outcomes in 2025: Compared to the end of 2024, total assets increased by 20.3% to approximately 2.6 trillion VND. At 2.38 trillion VND, mobilized capital grew at a rapid pace of 17.6%. The amount of outstanding debts increased by 14.7% to around 2 trillion VND. The non-performing loan ratio under the restructuring plan was around 1.2%, the lowest level in 13 years since Agribank executed the first phase of its restructuring plan (in 2013), while the on-balance sheet non-performing loan ratio dropped to 1.14%.

"With the groundwork of fundamental restructuring finished, Agribank will begin a new development phase in 2026, the first year of executing the 2026-2030 socio-economic development plan. Mr. Pham Toan Vuong stated, "The bank will continue to prioritize financial soundness, accelerate cost reduction, and improve operational efficiency, especially focusing on debt recovery to increase lending capacity and fulfill assigned tasks, given that monetary policy space in 2026 is thought to be limited."

Meanwhile, Sacombank ended the year with a big transfer deal after garnering a lot of attention with its accelerated restructuring plan. However, Sacombank is attempting to aggressively handle bad debts, as seen by its aggressive provisioning for the full year of 2025, reaching over VND 11,159 billion, with over VND 9,000 billion allotted for VAMC bond-related provisions in the fourth quarter alone. The bank will continue to struggle with debt collection this year, as seen by the non-performing loan ratio rising to a peak of 6.31% by the end of 2025.

Challenges in handling bad debts

Experts view the delayed "legalization" of Resolution 42/2017/QH14 on addressing bad debts, which is anticipated to go into effect in 2026, as a positive development and the first foundation for assisting banks in stepping up their debt recovery initiatives. The modified Law on Credit Institutions 2025 would enable credit institutions to proactively seize and handle collateral assets, which will speed up the debt resolution process, according to FiinRatings.

However, experts point out that factories and real estate make up the majority of collateral used to secure bank loans, followed by securities. As a result, the success of debt recovery is largely dependent on the recovery and growth of the real estate market, which is related to valuation and buyers' capacity to evaluate the prospects and absorption capacity of the assets.

The non-performing loans in banks in 2026 are one of the concerns brought up by Dr. Nguyen Quoc Hung, Vice President and General Secretary of the Vietnam Banking Association. He claims that even if non-performing loans are under control, they might rise once again.

"The process of asset foreclosure and enforcement of judgments still faces many difficulties in practice, even though the amended Law on Credit Institutions has allowed credit institutions to seize assets," Mr. Hung stated. Therefore, Mr. Hung suggested changing certain Land Law provisions that prevent the registration of asset changes and the receipt of real estate assets from enforcement agencies following several unsuccessful auctions, among other recommendations for the development of the banking and financial market in 2026. In order to assist banks in expediting the auctioning of secured assets and debt restructuring, this is a prerequisite.

In order to lower the non-performing loan (NPL) ratio in the face of the ongoing danger of rising NPLs owing to pressure from credit expansion and the possibility of declining reserve buffers, experts also advise banks to fortify provisions and carefully approve new loans. Improving asset quality will be a crucial starting point for long-term development, but the task will be substantial as many banks' net interest margin (NIM) continues to decline.