Banking sector set for record growth

16:06 | 26/07/2010

Being largely untapped and backed by strong consumer prospects, the banking sector in Vietnam is likely to grow at a compound annual growth rate (CAGR) of about 22% during 2009-2013.

According to research firm RNCOS's new report titled “Vietnam Financial Sector Forecast to 2013”, the Vietnamese financial market has rapidly expanded over the past few years and has gained great strategic importance at the global level. With the rapid liberalization, privatization and globalization of the market, Vietnam has become a preferred destination for international financial investors, particularly banking investors.

The research's findings show that the banking sector in Vietnam has unprecedented growth potential. The banking assets are expected to grow at a CAGR of about 21% during 2009-2013. The sector is highly underdeveloped as compared to the banking sector of other Asian economies like India and China. Most of the Vietnamese are still unbanked and use traditional ways of saving money and financing their needs.

Moreover, as the consumer lending in the Vietnam has not been actually developed, the banking sector in the country remained mostly unaffected from the negative impact of the global economic crisis. RNCOS found that most of the Vietnamese still rely on cash buying, and thus, use of credit products is negligible compared to other parts of world. These all factors make Vietnam full of potentials for exploring opportunities in the banking sector.

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