Private banks aggressively pay dividends and expect big profits in 2026?

If you've been following the stock market or gold market in the first half of 2026, you'll notice it's been quite difficult to make a profit, especially for FOMO investors who jumped in after deciding to chase gold or invest in a few "P-family" stocks. The point is, it hasn't been an uptrend like early 2025. After the tariff event, the stock market had a short uptrend, so I'm quite curious about private banks' expectations of strong growth for themselves.

1. The expectation of an economic growth phase

With expectations that the economy is entering an acceleration phase, aiming for double-digit GDP growth. First, we need to clarify what double-digit growth actually means.

To maintain double-digit GDP growth – specifically somewhere above 10% – I'll calculate using ICOR (Incremental Capital Output Ratio) :

ICOR = Capital investment during the period / Growth output during the period

Vietnam's current ICOR is quite high, around 6–6.5, which is higher than that of developed countries (average around 4). This reflects that investment efficiency is still low. Plugging into the formula clearly shows that to generate 1 unit of growth output, you need about 6–6.5 units of investment capital.

Vietnam's GDP is approximately $514 billion USD (according to VnEconomy). So 10% growth would be about $51.4 billion USD. The total initial capital investment would be about 6 times that – roughly $306 billion USD per year.

So we're looking at around $300 billion USD in total social investment capital. That's quite a large number, which shows that setting a double-digit economic growth target in the current period is very challenging and demonstrates the government's strong determination in setting this development expectation.

Back to the main issue: this year, the state needs double-digit GDP growth and requires about $300 billion USD in total investment capital. As mentioned, this is quite a large figure. To disburse public investment, simply put, the state cannot possibly "hold" and disburse all of that capital alone. So the state will focus on creating an environment to leverage private capital. The state plays a developmental role, the private sector plays the operational role, and the Public-Private Partnership (PPP) model serves as the strategic bridge. Specifically, the state will:

• Improve the legal framework: This is a key factor. Vietnam is actively building and refining the legal framework for PPP investment. A clear, transparent legal framework helps investors feel secure investing without fear of legal risks or sudden policy changes.

• Share risks: The state plays an important role in reducing the burden on the private sector for large, high-risk projects (such as transportation infrastructure and energy). For example, the state can handle site clearance, support administrative procedures, or commit to purchasing output products (electricity, water) for a certain period.

Private enterprises typically manage capital more efficiently and are more accountable for profits. And because of profit pressure, they will adhere to schedules and complete tasks faster. They will be the ones contributing the majority of construction costs (usually 70-80% of total investment in PPP projects) in exchange for the right to operate and manage the facility.

But wait – where does that 70-80% figure come from? Private entities also cannot invest such large amounts of capital on their own; they too must borrow. And that borrowing comes from private banks.

2. Private enterprises need investment capital – why private commercial banks rather than state-owned commercial banks?

Simply put, private banks have certain strengths that state-owned commercial banks lack:

• Flexibility and speed: A private business needs to borrow 100 billion VND to import a shipment within two weeks. A private bank can approve it in 3-5 days. A state-owned bank (like Vietcombank or BIDV) might take 1-2 months due to multi-layered processes.

• Understanding of private enterprises: Private banks typically have dedicated teams for specific industries, giving them a better understanding of cash flow and risks within private businesses.

• Higher risk tolerance: Private enterprises – especially startups or small and medium enterprises – often don't have "massive" collateral. Private banks are more willing to accept other forms of security, such as cash flow, reputation, and brand value.

• Healthy competition: The existence of private banks creates competition, forcing state-owned banks to improve services, lower interest rates, and diversify products.

To summarize:

• State-owned commercial banks provide large capital at low interest rates for large-scale projects but are slow and rigid.

• Private banks provide speed, flexibility, and deep understanding of private enterprises, even if their interest rates may be higher.

There you have it – we have a link: the expectation of high GDP growth leads to massive investment capital demand (hundreds of billions of USD). The private banking sector is one of the biggest beneficiaries, and in turn, they become the "flame" fueling further growth.

3. The growth spiral of private commercial banks

Unlike manufacturing businesses (which must invest in factories, machinery, and raw materials before selling products to earn profits), banks have a unique characteristic: profit is directly proportional to lending scale and is almost immediate.

Basic profit formula: Profit = (Lending interest rate – Deposit interest rate) × Total outstanding loans

• When the economy needs large capital: Private enterprises borrow heavily to expand factories, execute infrastructure projects, and import technology. The bank's total outstanding loans skyrocket.

• The result: Even if the net interest margin (spread) remains unchanged, the bank's absolute profit still increases exponentially due to scale.

Stable interest rates, but "explosive" profits – The net interest margin (NIM) of Vietnamese banks is typically stable around 3-4% per year, without sudden changes. However:

• The profit on each loaned đồng is 3-4%.

• But if the number of loaned đồng increases 2-3 times over 2-3 years, profits will increase correspondingly.

This explains why, during periods of rapid economic growth, bank stocks are often the "shining stars" on the stock market. Their profits can grow 30-50% per year for several consecutive years.

4. Non-interest revenue sources

As we know, the main contributors to bank revenue are interest earnings. But banks also have other profit sources, such as:

• Investments in real estate, securities, foreign exchange, and gold trading

• Service fee income: payment and transfer fees, card fees, trade finance fees

And so on… That's why private banks are confident in expecting high profit levels this year. Therefore, any investment portfolio should probably include at least one bank stock =))

The above is my article on why private commercial banks are confident about their profit expectations for 2026. The article is compiled from various sources and is written as a documentation of what I've learned. It is not intended for prediction or investment advice. Thanks for reading!