ASIA-PACIFIC-WIDE Trends and Developments Contributed by: Anand Shah, Suharsh Sinha, Ishan Handa and Saloni Thakkar, AZB & Partners
capital flows attracted by Australia’s legal frame - works and efficient foreclosure processes, and the emergence of specialised lending segments, including asset-backed lending, infrastructure debt, and direct lending to middle-market corporates. Vietnam: an emerging private credit destination Vietnam’s private capital market has undergone a sig - nificant transformation in recent years, establishing itself as a leading destination for credit funds. The market recorded USD2.3 billion across 141 deals in 2024, and whilst this represented a 35% contraction from the prior year, deal count remained relatively stable in both venture capital and private equity seg - ments. Notably, mid-sized deals in the USD100-300 million range demonstrated strong resilience, with capital invested rising 2.7 times to USD700 million, signalling improving investor confidence in sizable transactions. Buyout transactions dominated private equity activity, accounting for USD1.7 billion of the total USD1.9 billion in PE investment, reflecting a clear investor preference for mature, cash-generating busi - nesses amid a cautious investment environment. A significant development in the Vietnam investment landscape has been the emergence of highly struc - tured private credit transactions. Historically, the Vietnamese lending market was highly competitive on pricing, making private credit returns difficult to achieve given the perceived high level of risk. How - ever, this landscape has shifted considerably. The market has also witnessed the emergence of sec - tor-specific opportunities. Consumer credit stood at USD95 billion in 2025, whilst digital lending loan book balance is estimated to reach USD35 billion by 2030, growing at an annual rate of approximately 49%. AI funding has also surged eightfold year-on-year, whilst AgriTech investment grew ninefold, reflecting Vietnam’s increasing focus on productivity-enhancing technologies and sustainable agriculture. Despite these positive developments, there are con - cerns that Vietnam’s private credit market presents several structural and regulatory challenges that investors must carefully navigate. First, capital con - trols fundamentally drive transaction structures. Sec - ond, scholars observe that Vietnam does not have a
well-defined bankruptcy regime and large-scale bank - ruptcies are uncommon. A third major concern is that offshore lenders – wheth - er banks or credit funds – cannot take direct security over immovable property in Vietnam. This necessi - tates hybrid structures, involving local commercial banks, providing onshore loans or standby letters of credit to create a basis for security over underlying real property. Notwithstanding these challenges, Vietnam’s trajecto - ry towards investment grade sovereign credit ratings and its strengthening financial infrastructure present encouraging signals. The government has introduced notable reforms including the establishment of inter - national financial centres in Ho Chi Minh City and Da Nang, a National Blockchain Strategy, stock market upgrades to enhance foreign investor access, and amendments to real estate laws addressing legal bot - tlenecks. Thailand: steady growth amid regulatory evolution Thailand’s private credit landscape has also under - gone a transformation over the past two decades, with its corporate bond market emerging as the larg - est in the ASEAN region, with outstanding corporate bonds totalling USD166 billion by the end of 2024 – a more than fourfold increase since 2000. The Thai corporate bond market has expanded, with average annual issuance increasing from USD5 billion in 2000– 2011 to USD26 billion in 2021–2024, representing a more than fivefold increase. Non-financial companies have consistently dominated the market, accounting for roughly 60% to 80% of annual issuance. A distinguishing feature of Thailand’s private credit market is the unusually high participation of retail investors, who held approximately 40% of outstand - ing corporate bonds at the end of 2024 – an excep - tionally high figure by global standards. However, the market faces several structural chal - lenges: more than 90% of new corporate bond issues are investment grade, while private equity and ven - ture capital ecosystems remain underdeveloped com - pared to regional peers, with angel, seed and series A funding particularly limited. Corporate reliance on
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