Group-5 debts at banks continued rising in 2024. What percentage do they represent in the total outstanding loans in the banking system? The nature of group-5 debt The prime minister has recently directed the State Bank of Vietnam (SBV) to examine the sharp increase in group-5 debts reported by many banks and to consider appropriate measures to address and control bad debts, thereby improving overall credit quality. According to financial statements from 27 banks in the fourth quarter of 2024, group-5 debts rose by 39% compared to early 2024, reaching VND118,915 billion. As of the end of 2024, total outstanding loans in the banking system had amounted to VND15.6 quadrillion, up 15.1% against the end of 2023. Based on these figures, group-5 debts account for around 0.8% of total outstanding loans. However, this percentage only reflects data from banks that have publicly released their financial statements. It does not provide a complete picture of group-5 debts across the entire system. Moreover, the figure includes only those debts officially recorded as group 5 and excludes restructured loans that carry high risks and could potentially be classified as group-5 debts in the future. Under current regulations, group-5 debts include loans overdue by […]
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