Banks lead Vietnam’s ESG push with record sustainability disclosures. (Photo: iStock)
Vietnam’s financial industry is gaining momentum in promoting sustainable and green economic development, spurred by government initiatives.
According to the State Bank of Vietnam (SBV), a record 33 financial institutions released sustainability reports in 2024—the highest number to date. Additionally, the government recently approved a resolution offering a 2% interest rate subsidy for qualifying businesses, while also working to improve green credit liquidity.
Vietnamese banks take the lead with sustainability reports
The number of Vietnamese commercial banks publishing sustainability reports has surged in 2024. Most of these institutions have incorporated ESG (Environmental, Social, and Governance) criteria in their disclosures, and over ten banks have released separate ESG reports. As of May 2024, six banks have already published their sustainability reports.
Pham Thanh Ha, Deputy Governor of the State Bank of Vietnam, emphasized at a recent forum that sustainability is a critical component of future growth in the financial and banking sectors. He noted that sustainability reports serve as a tool to demonstrate commitment and leadership.
However, Pham also acknowledged the sector’s early stage in sustainability reporting. Challenges remain in legal frameworks, data collection, and analytical capabilities. He encouraged financial institutions to adopt artificial intelligence (AI) and digital tools to enhance the quality and efficiency of their reporting processes.
Green credit issued by Vietnamese commercial banks is also on the rise. In the first quarter of 2025, 58 financial institutions held outstanding green loan balances totaling over VND 704.2 trillion (about USD 27.1 billion), marking a 3.5% increase from Q4 2024. Over the past seven years, green credit has grown at an average annual rate of 21.2%, significantly outpacing overall credit growth.
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Green credit issued by Vietnamese commercial banks is on the rise. (Image: iStock)
Interest rate subsidies to boost green finance momentum
Cassandra Goh, Managing Director at Silverlake Axis, noted that sustainable finance is rapidly becoming a driver of innovation in the Asian banking sector. Although green loans currently account for just 4.2% of Vietnam’s total credit portfolio, the growth trend is clear. Goh also mentioned Vietnam’s intention to develop national green taxonomies, modeled after similar frameworks in Singapore and Indonesia, with completion expected by the end of the year.
To further support green economic development, the National Assembly passed a resolution in mid-May to expand subsidies for private enterprises, household businesses, and entrepreneurs engaged in circular economy practices, green initiatives, or projects aligned with ESG standards. Eligible borrowers will receive a 2% interest rate subsidy.
Dale Hardcastle, Director of Bain & Company’s Global Sustainability Innovation Center, commented that despite concerns about a macroeconomic slowdown potentially hindering green growth, governments, corporations, and investors are adjusting strategies. As a result, Southeast Asia and the Asia-Pacific may still see resilient growth in the green economy.
Source: Vietnam Investment Review, Vietnam+, State Bank of Vietnam
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