This study aimed to investigate how close banking relationships affect Vietnamese public listed firms’ financial performance based on the empirical evidence of 172 companies listed on Ho Chi Minh City Stock Exchange in the period 2017 – 2019. Regression models, including Pooled Ordinary Least Square (OLS), Fix Effects Model (FEM) and Random Effects Model (REM) were explored to test the proposed hypotheses. The results indicated that banking relationships have advantages that outweigh disadvantages, which brings a positive impact on firm performance. These results suggested that firms should pay attention to the quality of the banking relationships instead of seeking for negotiation power and diversity in sources of funds.