There are approximately 50 domestic banks in Vietnam; no one is sure of the precise number. The market is dominated by five state-owned banks, previously policy-driven lenders that are now being restructured and dressed up for privatization: Foreign Trade Bank of Vietnam (Vietcombank), Vietnam Bank for Agriculture and Rural Development (VBARD), Mekong Delta Housing bank (MHB), Industry and Commerce Bank of Vietnam (Incombank) and Bank for Investment and Development of Vietnam (BIDV). These four control approximately 75% of the market by assets and between them run more than 1,200 branches nationwide. Plans to privatize them are under way, with Vietcombank and MHB slated to be the first to list, probably in 2007. According to the finance ministry, the remaining three state-owned banks will be privatized by 2010.
The rest of the domestic market is dominated by the joint stock commercial banks, of which there are between 30 and 35, depending upon whom you speak to. These are banks that have incorporated as companies, or equitized, as the Vietnamese are fond of saying, although most of them are not listed. Some are wholly owned by private interests; others are still state-controlled. Generally, these banks are run on a more commercial basis and have stronger management teams. Many of these joint stock banks are planning to list on the local market within the next few years. The joint stock banks control some 20% of the local market by bank assets.
The balance of the local banking market is made up of foreign banks, which command perhaps 5% of bank assets and are led principally by ANZ, Standard Chartered Bank and, more recently, HSBC. The number of foreign banks is growing as the market opens up and new investment opportunities arise, although government restrictions on their expansion are still strict.