Vietnamese firms still prefer bank loans over foreign capital markets, a trend that shapes the country's financing landscape. Understanding why they stay with banks helps students of finance see the real obstacles to international fundraising.

Most Vietnamese businesses continue to rely on bank loans because the procedures are relatively quick and straightforward, according to the article. Johan Nyvene, chairman of the board of Ho Chi Minh City Securities Corporation (HSC), noted that most domestic businesses have traditionally raised capital through bank loans.

Nyvene said Vietnamese businesses remained inadequately prepared to raise capital in international markets, lacking personnel with the necessary capabilities and comprehensive data systems. He highlighted that many firms do not have staff able to handle the complex tasks required for foreign fundraising.

Nyvene explained that raising capital internationally requires financial advisers, legal advisers, international auditors and underwriters, and that preparation costs can reach several million U.S. dollars. By contrast, bank loans generally involve limited spending on consultancy services and document preparation.

Nyvene said international investors require transparent information and detailed due‑diligence, such as revenue breakdowns, revenue sources, and long‑term customer data. Investors also ask for explanations of operations, customer groups and future revenue prospects.

Nyvene added that many Vietnamese businesses only look at international fundraising when bank interest rates rise sharply and they have no long‑term capital plan, making their approach reactive rather than proactive. Thus, the combination of quick bank processes, preparation gaps, high costs and investor demands keeps firms tied to domestic lending.