Vietnam should develop securities backed by real estate loans to diversify funding sources for the property sector, reduce reliance on bank credit, and strengthen the country’s capital markets, the chairman of the Vietnam Securities Depository and Clearing Corporation (VSDC) said.
Speaking at a conference titled “Synchronized solutions for capital market development”, held in Hanoi by The Investor on Thursday, VSDC chairman Nguyen Son said outstanding loans to the real estate sector and related fields accounted for around 23% to 25% of total bank credit in 2025, despite the sector contributing only about 3.5% to economic growth.
As legal bottlenecks surrounding many property projects are gradually resolved, demand for financing is expected to increase further. Continued dependence on bank lending would place growing pressure on Vietnam’s financial system.
Son proposed developing securities backed by real estate loans, under which banks would provide financing during the early stages of project development before packaging the loans into tradable debt instruments after two to three years.
Such a framework would allow banks to recover capital, ease pressure on medium- and long-term funding, and create room to extend new loans, while expanding the range of investment products available in Vietnam’s capital markets, he said.
However, Son warned that any securitization framework would require robust supervision and risk management to avoid problems similar to those that contributed to the U.S. subprime mortgage crisis of 2007-2008.
Vietnam Securities Depository and Clearing Corporation (VSDC) chairman Nguyen Son speaks at a conference in Hanoi, July 23, 2026. Photo by The Investor.
Bank lending dominates financing
Vietnam’s financial system remains heavily dependent on bank credit, with outstanding loans equivalent to around 146% of GDP, while the country’s stock market capitalization stands at roughly 82% of GDP, Son said.
The structure creates maturity mismatches because banks rely largely on short-term deposits to finance medium- and long-term loans, particularly in the property and infrastructure sectors, increasing risks for the banking system.
In more developed economies, bank lending typically accounts for only 25% to 30% of total financing, while around 15% comes from foreign direct investment and the remainder is raised through equity, bond and other capital market instruments, Son said.
Citing industry research, he said Vietnam would require approximately $1.5 trillion in investment capital between 2025 and 2030, equivalent to more than three times its current GDP and about 3.7 times the capitalization of its stock market.
Beyond developing securitized loan products, Son said Vietnam should broaden its long-term funding ecosystem by attracting more foreign investors, simplifying procedures for obtaining securities trading codes, and strengthening links between international custodian banks and domestic securities firms.
He also called for the completion of a central counterparty (CCP) clearing model, scheduled to begin operations in early 2027, to help Vietnam meet the criteria for an upgrade in its stock market classification.
On the demand side, Son said policymakers should encourage the development of institutional investment vehicles, including voluntary private pension funds, real estate investment trusts (REITs), insurance-linked investment products and other long-term funds to provide a more stable source of capital.
To expand the supply of investment assets, he urged authorities to accelerate the equitization of state-owned enterprises, encourage more private companies to launch initial public offerings (IPOs), and consider restoring a framework that would allow foreign-invested enterprises to list on Vietnam’s stock exchange.
Son also called for a stronger legal framework for public-private partnership (PPP) project bonds, ESG-compliant green bonds and a dedicated exchange for start-up companies, saying these measures would diversify funding channels for the broader economy, including the real estate sector.