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GREEN CREDIT OF THE JOINT STOCK COMMERCIAL BANK FOR

INVESTMENT AND DEVELOPMENT OF VIETNAM (BIDV)

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Le Thi Thuy , Ho Thi Hoa 163 , Phung Thi Trang

Abstract: The green economy is a model that Vietnam has chosen to restructure its national
economy. The transition from the current economic model (brown economy) to a green economy
requires comprehensive, multi-sectoral, and integrated measures implemented across various
programs. Securing resources, including financial resources, is a crucial condition for achieving the
country's green transition and sustainable development objectives. Therefore, the deployment of green
credit is expected to become a key trend in the operations of Vietnamese commercial banks in the coming
years. This study focuses on analyzing the green credit performance of the Joint Stock Commercial Bank
for Investment and Development of Vietnam (BIDV) during the 2018-2023 period. Utilizing financial
analysis methods (such as comparison, induction, synthesis, and analysis), the authors observe that
BIDV has demonstrated strong growth in green credit provision. During this period, BIDV not only
expanded the scale of green credit but also diversified the projects and clients accessing its green credit
packages. Specifically, the bank allocated several preferential credit programs to green sectors,
including renewable energy, clean energy, low-carbon production and consumption, and climate
change adaptation, thereby contributing to the transformation of the economy towards green growth.
However, the proportion of green credit outstanding relative to BIDV's total credit portfolio remains
modest, limiting the clear impact of green credit on the bank’s overall performance.
Keywords: Green credit, operational efficiency of commercial banks, BIDV

1. Introduction
Vietnam has implemented "Economic restructuring associated with changing the
growth model" towards sustainable development. The Vietnamese government has also

issued the National Strategy on Green Growth for the period 2011-2020 and the vision
to 2050. In 2021, the government continued to issue the National Strategy on Green
Growth for the period 2021-2030, vision 2050, through Decision No. 1658/QĐ-TTg
on October 1, 2021. It can be seen that in its action plans, Vietnam is considering credit
institutions as an important component to direct investment capital towards
environmentally friendly production activities, minimizing risks for the national

sustainable development goals.
With the goal of developing a financial system that serves all members of society,
green credit not only benefits businesses implementing economic development projects
but also benefits the commercial banks themselves providing this green credit. The
sustainable development of commercial banks will be reinforced through minimizing
bad debts, enhancing financial stability, and building a reputation in the market. Thus,
providing green credit also positively impacts the operational efficiency of commercial
banks and affects their credit risk. Researching green credit and the performance of

Vietnamese commercial banks will provide an overview of the green

162 Academy of Finance, Email: lethithuy@hvtc.edu.vn
163 Academy of Finance
164 Academy of Finance

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