Vietnam Financial Sector Analysis until 2013

Vietnamese financial market has quickly expanded during the past few years and has gained huge strategic significance at the global level. With the fast liberalization, privatization and globalization of the market, Vietnam has become a preferred destination for international financial investors. The key financial sectors ‘banking’ and ‘insurance’ are attracting huge foreign investments as both of these sectors characterize highly unused potential.

As per our new research report “Vietnam Financial Sector Forecast to 2013”, Vietnam’s banking sector is transforming and ongoing deregulations will fuel the sector’s growth in the coming years. The research identified that the majority of the Vietnamese are still unbanked and use conventional ways of saving their money and financing their desires. This represents a highly untapped and potentially profitable market for existing as well as new market players. The projected 29% CAGR growth of banking asset (during 2011-2013) further confirms industry’s attractiveness.

At the insurance front, the sector has expanded quickly during the last few years and has witnessed boost in the presence of foreign players. The insurance area increase has been mainly a consequence of growing presence of foreign players, which intensified the market competition and benefitted consumer the most. Further, growth in insurance premium has been phenomenal with total annual premium falling in double digit bracket during 2005- 2010.
similarly, micro financing has huge prospective in the nation as the demographic indicators have been helpful in nature with around 73% population living in rural areas and about 54% of the national workforce working in agriculture sector. As of now, total loans outstanding in rural areas comprise only 17% of the total bank credit and more than 80% of the rural population does not have access to any kind of institutional financial sources