Stock Market

The New Wave of Banking: Leading Expectations and Managing Margins

The post-COVID-19 era has witnessed a record-breaking rally for bank stocks, but this impressive performance belies a more nuanced story. This surge is underpinned by a combination of factors, including heightened expectations and the influx of margin financing into the financial sector. While this has provided a much-needed boost to the market, it also presents challenges, as the margin contraction highlights a delicate balance that could impact the market's trajectory.

Administrator

27 August, 2025

Bank stocks break records for the second-highest number of times in history

Despite the VN-Index experiencing strong profit-taking sessions, bank stocks have produced extremely impressive statistics.

As of August 25, bank stocks have broken closing price records a staggering 241 times, spanning 16 out of 27 codes.

This means that nearly 60% of bank stocks have witnessed this record-breaking phenomenon. Notably, the total number of record-breaking instances in the first nine months of 2025 is not only the highest since the post-COVID-19 era but also the second-highest in the history of bank stock waves in the Vietnamese stock market.

While the upward trend in the first half of the year mainly focused on large-cap banks, the wave spread to Mid Cap banks such as EIB, VIB, TPB, and MSB in the third quarter of 2025.

In order, MBB is currently holding the “king” position for record-breaking in 2025 and throughout the entire historical statistics. Since the beginning of the year, MBB (40 times) has seen a nearly 60% increase. Following closely is STB with 32 record-breaking sessions, surging by 44%. Additionally, codes such as CTG, TCB, and ACB have also joined the list of peak performers, playing a crucial role in pushing the VN-Index towards the 1,700-point mark in August.

Evidently, this year’s bank stock wave is not only broad in scale but also intense in momentum, making this sector the focal point and main driving force of the entire market.

Expectations vs. Reality: Margin “Contraction”

Even though bank stock prices have soared, their business performance and financial strength vary significantly.

The 2025 half-year report by VIS Rating reveals that large banks and state-owned banks (SOB) are witnessing substantial improvements due to reduced bad debt, lower credit costs, and better loan recovery. Some codes, including CTG, MBB, and VPB, are further supported by legal advancements in real estate projects.

On the other hand, smaller banks face challenges such as high funding costs due to intense competition, large risk provisions, and limited liquidity. Banks like PGB, VAB, BVB, and SGB remain among those with the highest non-performing loan formation rates in the industry.

Investors believe that the recovery of the real estate market, along with credit policies, will gradually enhance asset quality in the second half. Simultaneously, the requirement to transition to Basel III norms forces banks to raise capital and expand their scale, creating new expectations for the industry’s stocks.

However, it’s important to note that the market’s expectations are currently built on the backdrop of continuously rising margin debt levels.

Mr. Nguyen The Minh, a market analyst, commented: “The recent sharp declines have highlighted the market’s dependence on the banking sector. While margin debt may not be a direct risk, the concentration of investments in financial stocks remains a challenge for the overall market.”

According to Mr. Minh, it’s understandable that financial stocks attract investment flows during this phase as they are the leaders. However, for the market to develop sustainably, there needs to be a spillover effect to other sectors. Banks have demonstrated their allure and pivotal role, but a robust and investor-attractive market requires the accompaniment of other industries.

In retrospect, the 2025 bank stock wave is one of the most remarkable price-appreciation phases since the COVID-19 era, both in terms of scale and frequency of peak formations. This surge not only reflects the business performance but also showcases the market’s faith and anticipation of long-term changes, particularly in capital augmentation and the adoption of Basel III norms.

The banking sector has been and is likely to remain the pervasive industry wave in the Vietnamese stock market. However, to sustain market allure, the dispersion of investment flows to other sectors is crucial. This presents both opportunities and challenges for the next phase.

Quan Mai

– 13:19 26/08/2025