Banking & Finance

The performance of Vietnam’s banking industry will improve as Covid-19 gradually passes, according to the latest report from credit ratings agency Moody’s Investors Service. Almost all indicators, such as NIM (net interest margin), CASA (current account savings account), ROA (return on assets), and LDR (loan to deposit rate) of banks will significantly improve this year, it believes.

Real estate contributes greatly to Vietnam’s economy, accounting for 8-9 per cent of GDP, according to the Vietnam Association of Construction Contractors (VACC). However, real estate businesses are having major difficulties finding projects due to problems with mechanisms and policies. They therefore look forward to the completion of the legal framework, including additions and amendments to the Land Law and the Law on Real Estate Business.

Since introducing the nationwide electronic invoice (e-invoice) system on April 21, their use in many cities and provinces has reached over 50 per cent and in some cases 90 per cent. The amount of taxes paid by individuals through the eTax Mobile system since its implementation on March 21 stands at nearly VND160 billion ($6.29 million). Meanwhile, five foreign suppliers not permanently established in Vietnam voluntarily declared and paid taxes through the website of the General Department of Taxation.

Vietnam’s capital market is developing quite quickly, according to Professor Hoang Van Cuong, a Member of the National Assembly’s Committee for Financial and Budgetary Affairs. The market reached 134.5 per cent of GDP last year, or 3.5 times higher than in 2015. It still has limitations and shortcomings, however, and needs to be transformed from quantity to quality to ensure sustainable development.

According to SSI Research, while Vietnam’s stock market saw a net withdrawal in April, capital to ETFs (exchange-traded funds) were strong, with a total value of VND1.69 trillion ($73.29 million); the highest in nine months. The market therefore recorded a net capital inflow in the first four months of the year.

Believing that stock selection at this time is more important than forecasting market trends, the Viet Dragon Securities Company (VDSC) has suggested that investors focus on buying into industries with positive expected second-quarter business results, such as seafood, gas thermal power, technology, and banking.