Vietnamese Banks Downsize Amidst Digital Evolution

Photo courtesy of Toui Tre

In a significant shake-up within the Vietnamese banking sector, LPBank reported the most substantial workforce reduction in the first half of 2025, with 1,986 employees—nearly 18% of its staff—leaving. This marks a stark contrast to 2024, when the bank added 562 new positions.

The trend isn't isolated to LPBank. Retail banking giants VIB and Sacombank also faced reductions of over 1,000 employees each. VIB cut 1,186 positions in the first six months, more than doubling its reductions in 2024, while Sacombank shed 1,158 jobs, a sharp increase from 354 last year.

Further cuts were seen at ACB, which let go of 607 employees, reducing its workforce to 12,240. ABBank trimmed 469 positions, and Agribank cut 273 jobs. Vietcombank, despite previously expanding by 796 staff in 2024, reduced its workforce by 191, bringing the total to 23,347. Meanwhile, VietinBank managed to slightly increase its staff by 15, reaching 22,507 as of June 30.

Le Hoai An, a banking strategy expert, highlighted that these layoffs are largely driven by digital transformation efforts within the sector. Retail banks are pivoting towards corporate lending, moving away from personal loans, which are becoming highly automated.

“Processes for personal loans, such as home and car loans, now require fewer staff thanks to digital workflows,” An explained. Additionally, electronic Know Your Customer (eKYC) procedures have reduced the staffing needs at branches.

Despite the rise in automation, corporate lending remains a challenge to fully automate due to the unique requirements of each business. This partly explains why retail divisions have seen more job cuts.

A commercial bank representative mentioned that priority is being given to interest rate cuts and cost reductions. Banks in Europe and the U.S. have already reported significant job reductions due to AI, and Vietnam is expected to follow this trend as AI adoption increases.

An forecasts that the Vietnamese banking industry will continue to evolve over the next three years with AI integration. Currently, net workforce growth in banks has averaged a modest one to two percent annually, while income has surged by 10–15%.

Tran Thi Nguyet Oanh, head of HR at HSBC Vietnam, indicated that roles like bank tellers and secretaries are highly vulnerable to automation, as outlined in the World Economic Forum’s Future of Jobs 2025 report. Digital processes have largely replaced in-branch paperwork, and AI is increasingly used for data analysis and fraud detection.

She noted, “While technology replaces some jobs, it also creates new roles in big data, AI, and cybersecurity.” The financial sector is expected to see a demand for specialists in these areas, reshaping the employment landscape.

Dinh Duc Quang, head of treasury at UOB Vietnam, echoed that while many traditional roles are being automated, jobs requiring human interaction and relationship-building remain critical. The next generation of bank employees will play a vital role in bridging technology with client needs.

Banking expert An believes that while new technologies boost productivity fivefold, the overall job creation may not keep pace. By 2027, he estimates that about 10% of the banking workforce could be laid off.

As the sector navigates these transformative changes, it’s clear that while opportunities arise, challenges persist. The balance between embracing digital change and managing human capital remains delicate, yet crucial for the future of banking in Vietnam.

  Adapted by ASEAN Now from Toui Tre 2025-08-15